Junk Silver or American Silver Eagles?

Hey friends,
In a few weeks hopefully I'm gonna start collecting silver in a big way, well it's big for me. Now I've always preferred junk silver b/c not only is their a profit for silver content but there's also the numismatic angle to profit from. On the other hand, ASE's are always the best way to stack as far as ounces go IMO, because of the easy liquidity bonus. Which way do you roll? Do you stack silver rounds, ASE's or junk silver and why do you think your choice is the most solid way to invest? Anyone?

 

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Are you collecting silver or investing (stacking) silver? It doesn't seem any clearer ("hopefully") than whether you are actually going to be able to go into this is in a big way or not, which sounds more like you're about to take a huge risk in physical PMs without much reasoning other than suggesting you are about to come into a bunch of cash (the most liquid position you could be in) and may have said cash burning a hole in your pocket, if not spent, before you already lay hands on it and get it into those pockets to be burnt through!

How do you explain profiting from the numismatic angle of junk silver? Is it not junk for the very reason that it falls too far below the level of a numismatic premium, and so tracks it's intrinsic value instead of a collector premium?

Most don't stack just one type of a given metal, but take it in nearly any form procured at the best price it is obtainable at, perhaps favoring certain types only when available for a preferred storage situation (selecting bars, rolls or pucks over bullets, fantasy shaped or poured pieces that don't stack well and carry high premiums), go with fractional 'junk' denominated coins for practicality if ever it was needed for small transactions in bullion to replace fiat currencies, and so on.

As to why any one individual's choice is 'a solid way to invest' is entirely dependent upon the unique situation of each individual's goals, available funds, outlook, appetite for risk, emotional temperament or lack thereof, and so on, and is not really something replicable, nor the best option for others' situations, and rarely ever comes off as clear to readers in a forum (such as this inquiry to your ideas).

So are you just here to tell us you are about to have greater spending power, or do you actually have an investment plan that soundly involves silver in some fashion? I have the sneaking suspicion it's more likely to be similar to how lotto winners blow through their winnings in short order. I'd suggest buying and digesting some books on investing before going hog-wild with a windfall, retirement payout or some other surplus of funds that perhaps inspired this.

This is a cow. Cows drink water and eat grass. Cows make milk. People drink milk, and buy lots of it, especially when the weather guy/gal predicts a big storm. Grocers tend to sell out during these times. Dairy farmers need clean water and land for their cows, truck drivers bring product to market and grocers sell milk. All need your investment monies, too. Just because you like coins, don't overlook the greater market and the huge impact investing in other areas can have on ROI over funds locked up in PMs.

 

Not all silver sold as junk, is actually junk silver. Sometimes you can find gems in junk silver and sell at a premium.

 

Good luck. Let us know how it turns out if you get into it. Honestly, it sounds like a lot of effort for little reward in an area so overly ahead of you in the game that I'm not sure if you've even got your feet on the ground with this proposal. In lieu of this it's probably better to stay a collector if you're not identifying your investment focus any further than what you have said so far. It's not easy (profitable) just because you may have the ability to spend money "investing" it. The growth of bullion companies have long since seized on this idea and are no doubt clearing houses for such "junk" sold to them by dealers back-logged with "junk" from collectors and stackers when they burn out or want rid of the stuff, where it is then sent off for melting and refinement into shiny new rounds that they mark up and resell to the same minded people thinking about getting into PMs in a big way.

 

Have you asked yourself WHY you are collecting silver? Is it for possible price appreciation (profit)? Is it part of an overall investment strategy that would include other instruments such as stocks and bonds?

If you have come into money you want to invest, my main thought is this: There is seldom a worse idea than putting all your eggs in one basket, be it stocks, bonds or PMs.

 

I have not come into money and I don't have an investment strategy. I just feel in a few weeks I will be willing to buy silver and in the past I sold all my silver and stopped buying for awhile. The question isn't that difficult. Which is better to collect and why, junk silver or ASE's? Yes, collecting simply for possible profit.

 

I've always shied away from 'rounds' and have purchased 'eagles' instead. I like the fact that you can unload them (if you must) rather quickly, and you're pretty much assured of getting very close to 'spot' or (sometimes) over.

 

To answer your question without rumbling forever, I would buy American Eagles, junk silver has alot of ware and probably doesn't contain as much silver cause of the coins being wore down.

 

It both is and isn't difficult. It's difficult to respond simply because of the way you pose it full of contradictions ("I've always preferred junk silver" vs. "ASE's are always the best..."), and the OP is essentially about you, not others, so to help you, you have to identify your goals for us to lend you the best ideas. It can be and often is difficult. If it was so easy...

"I have not come into money" Sorry to hear that's not the situation. "and I don't have an investment strategy." That was apparent, hence my line of questions to help you consider finding one before making a mistake "in a big way". "I just feel in a few weeks I will be willing to buy silver..." If you feel now that you will be ready at some future point, I don't see what is holding you back from getting started unless you are taking the stance of people who say, "I'm a buyer at $X price-point." People said things like this extensively as prices soared a few years ago, then seemed to evaporate like the price of spot as prices collapsed and they feared they'd still buy at too high a price. Failure to commit costs you time, a very critical thing in investing. So, what does a few weeks have to do with the decision? Is silver set to drop in your opinion? Or are you just starting to pool funds for this venture? Or do you just need help with where to start, or justification from strangers that it's acceptable to start buying? But that sort of contradicts the next bit you wrote, "and in the past I sold all my silver and stopped buying for awhile." So you already have experience of some sort and preferences of what to buy and why.

Instead of looking for simple answers, go back and review the other things suggested. Buy some books, watch markets and question what has happened to the price of metals in recent years, consider why buying certain forms of metals rather than putting all your faith in junk vs. rounds vs. ASE is considerably wiser or more fiscally prudent based on your personal budget and goals. It's short sighted to simplify the questions, and refusing to think about the challenge of profiting from junk for some minimal numismatic value isn't likely going to reward you as you hope, unless you are just a collector, which is what it sounds like. Furthermore, consider why you are meeting a tough menu of options as this is a bullion thread, not a collector thread.

"Yes, collecting simply for possible profit." Then collect what is already accepted as numismatic material. I suggest you avoid 'collecting bullion' or the stuff marketed to people as limited, collectible or issued in a series. It's all marked up, and produced for people just like you appear to be approaching this and not knowing why they are about to fall into the trap. You are a collector, but if collector prices are turning you away and making you consider bullion, look deeper and find another area of collecting. That's why I suggested earning money from other investment opportunities, and not to settle on bullion because you like coins.

 

I think junk silver and ASE's are equally liquid for the most part if you have a willing LCS. I'd try to figure out their buying/selling points on both products and when you can find 'deals', buy whichever one you can. Run of the mill ASE's probably won't have much of a numismatic value by years anymore since they're making 40M of them a year, so they're an ounce of silver. My LCS will pay $1.00 over spot for them. So you have to know what you pay for them and where silver has to go to make money. If you're just stacking as a store of value, it's tough to make any money till silver goes up an appreciable amount. Unless you're buying unsearched rolls of junk, I think it's tough to find the 'gem' out there consistently enough to really make it worthwhile. But you can find and buy junk on the cheap from time to time. Good luck whatever you do. Don't let the money burn a hole in your pocket. Research what you want to do and have a couple pronged strategy.

 

If you're dealing with an actual store, sometimes you can find "impaired" or "circulated" ASEs for the same cost as rounds. I've added a couple to my collection this way. My old LCS sold ASEs with milk spots or finger prints this way and I think I got a good deal. So what I'm saying is, check out the mix bin of generic rounds if they have one.

 

if I had what seems to be extra cash I would get gold as that has a better return on an investment than silver unless like the other forum people say coins can bring a fairly decent profit if you can afford to hang on to them awhile and its demand that will get the profit as one reader says don't dump all your eggs in one basket if you have the extra cash different metals would be wiser if you have watched the market junk silver is not much profit just my opinion

 

Agreed. AS long as there's no holes or significant weight reductions, this path is the best deal I've seen.

Though, one of the dealers that did it this way, also bought such ASEs at a discount as well.

 

You better believe that dealer got a discount I'm an over the road truck driver I have called dealers cause I don't have time to go visit one, every pawn shop dealer I spoke with said we charge 1 more dollar than Apmex wich is high, so the local dealer is not the end all be all they night be in some cases but very few.

 

I own both but prefer junk. As far as some coins being worn and therefore having less silver: I'll trade 1964 Roosevelts for Merc's any day.

 

If I could buy 100 eagles or 100 mixed morgans, and the price was the same, there is absolutely no question I'd go with morgans. I've found killer minor errors and list vams in bulk lots of morgans that were worth double to triple or more what I paid. To each their own I suppose

 

I own 100 ASE's and $100 face of "junk" silver. Good to have a mix. I tried not to get really worn silver. I got 2 rolls of XF-AU Walkers for 13.5x face. The really worn stuff can add up to a lot of missing silver, so it's best to buy it on actual weight and not face value.

 

Don't limit yourself to ASE. The newer maples are beautiful rounds with the radial design. I've been getting them for < $2 over spot. Also, the newer Brittanias are very nice. JMBullion has them for $1.59 over spot for any quantity right now!

 

Alright! Agreed! Lotta good answers coming from y'all! ~Cheers!

 

Here's a picture of the majority of my stack (1275 troy oz strong), not sure if I shared it on this forum or not. Buy what you like if you're collecting. That's what I do and I've made some decent money flipping items to buy more silver while I'm at it.