New to the idea of investing... a couple quick questions to clear up?

I've been considering selling a large (large for me, at least) amount of the silver I've been collecting pretty much my whole life. Starting to really look at PM markets for the first time, and have realized this rabbit hole might not have a bottom! My mind is reeling right now - this is the first time I've ever read market analysts or exchange reports. What I am taking away from all of it, the information I've gleaned, is that I'm likely better off holding onto what I have - and even increasing my stockpile - if I do not need the cash immediately, if I can resist short term profits and hold out for the long haul.

I know that in the end it's got to be my own decision, I cannot rely on someone else's opinion on whether to sell or hold. I have 2 questions, though. Or maybe 3.

Number one, the easiest (hopefully) question of all... Is numismatic silver or bullion silver better for investing long term? Or is there no real difference? If I wanted to trade my numismatic silver for bullion, would that simply be melt-for-melt value, or would one side hold a premium?

Second, and related, question - if any of you have ever bought the large FV lots of silver coins off of APMEX, is the stuff they provide completely picked through already, or might it be a good way to hunt for some decent coins?

And finally... the articles I have been reading have all been making outrageous claims such as '$10k gold and $150 silver is coming'. Being brand new to reading this stuff, my question would be - have they ALWAYS talked like this? Do these analysts, or whomever, always make huge claims? Or do they actually say different things at different times, actually analyzing trends? I'm not asking how accurate they are, just whether they actually TRY to be accurate.

Thanks.

 

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Yes, some of them have always talked like this, always made huge claims. Some of them say different things at different times, or at the same time. Some of them are right, sometimes for an extended period. And I'm sure they're all trying their best, but... if it could be predicted accurately, it wouldn't be much of a market, would it?

 

Don't know if this helps, but IMHO, there's never anything wrong with selling some off the top and banking some profit. No rule says you have to sell all your holdings at once, either. As CNBC's Jim Cramer puts it: "Bulls make money, bears make money, but pigs get slaughtered."

 

I believe that what you collect - if it be numismatics, you buy a great coin for the price. May it be Au or Ms, buy the coin you like, because you may hold on to it, or, pass it on to the next generation.
I feel numismatic's holds value, it's
Not, an investment.

 

That's a good point, and of course i'm separating out everything with better dates, varieties, errors, BU/MS, or otherwise interesting coins lol. Basically anything that has nothing special about it other than the silver, is what I'm considering right now. But there is a lot... Definitely over $700FV, maybe as much as $1000FV, that I am sorting out as 'investment silver'. If I sell a portion of that, that will give me some money to work with - get back into CRH maybe, which is where most of it came from over the years. I've not really done much the past couple years, but I used to search at lest $20k-$30k per month, $1000 to $2000 at a time. Haven't had that much free, liquid cash in years though... been living month-to-month trying to start a business. Which is why I was considering selling in the first place. I've never sold any of it before.

The other option, of course, is to let go of a few numismatic pieces, and use THAT money instead... while silver may go up and down, a $600 silver coin that is a key date probably won't move with the market much, right? If silver hits $100 an ounce, what are the chances that coin goes up proportionally?

I don't know. The only thing I am sure of, is that I need to take my time and think rationally, not make an impulsive decision. What do I want to do, and if I want to invest, what kind of investor do I want to be?

 

Those are two totally different investments. I cannot really speak to precious metals investment, other than that to say you will see worse returns over time with that than if you just put your money in the stock market. Numismatic coins are also not typically a great investment unless you are at the level where you can afford very high-value rare coins. Otherwise, numismatics should be considered a hobby rather than an investment.

I would not recommend buying bulk lots off national bullion dealers like APMEX in search of high-quality coins. You may find the occasional better-than-average coin, but you will find many more problem/cleaned coins.

I'm not sure specifically what articles you're reading, but chances are they are written by people who have a vested interest in seeing precious metal prices increase. Look in any major newspaper and you will find an ad screaming that now is the time to invest in gold - the companies that run those ads run them continuously regardless of the trend of bullion prices, only changing their messaging. If gold is dropping in value, they'll claim it's a historical, can't-miss bargain, and if it's rising, they'll tout the amazing returns that gold has delivered.

 

Sorry, I need to clarify. I actually meant junk silver... is 90% silver junk coins better for investing than .999 bullion rounds? Or the other way around, or pretty much the same? Only talking about coins worth their silver melt value. Not higher end stuff.

The articles I started reading are the ones linked at the top of the page on coinflation, actually. Not sure if that makes a difference.

Thanks for your answers!

 

We've been within days and weeks of the zombie apocalypse since I've been paying attention, and that goes back to 2010. It's all just pumping to sell newsletters and stampede sheep into bullion based on fear. Bullion has a place in everyone's portfolio, but don't bet the farm on it. Lots of people blew everything they had chasing silver up to $50 last time, hoping to grab the last foot of rope to $100.

They'll never be whole again. Buy a little bit every so often. And if you need to know if it's a good time to buy or sell, ask any average joe what they think, and then do the opposite.

 

lol at 'average joe'

I do know I'm not really a gambler - I lived in Vegas for nearly 2 years and spent only about $20 on video slots my first week because I was bored, and they were ALMOST video games. I won $300 doing it, and still never had any interest in doing more

The point is, I'm not interested in getting the absolute top of the peak On the other hand, if the analysts think it will raise to over $100, then waiting until $30 to sell, in a couple years, doesn't sound too ridiculous? And even if it drops back down soon, it will raise to at least the current $20 again eventually. So what am I missing out on, other than a bit of time? These are just the thoughts running through my head right now. Not actually arguing, here, just sharing stream of consciousness lo.

 

I've been following Coinflation for many years now. In that entire time, I can remember maybe once noticing an article that was distinctly anti-PM-mania. They run a fair amount of strictly factual stories, but the clear majority of material they link is somewhere between "PM can do no wrong" and "wrap SILVER foil around your hat, because remember, silver is more conductive than aluminum."

 

This is powerful advice and backed up with evidence. What the average small investor does is terrific advice if you do the exact opposite. Not picking on them, but small investors move in herds, and buy too high and sell too low. Being part of that herd will only bring you subpar results. If you can always be in front of that herd you can do terrifically, but its a dangerous game guessing where an emotional herd will go.

Better to simply think for yourself. If you ever read an article about investing that uses scare mongering words, you can be assured the article is worthless propaganda. There have been decent articles on pm on coinflation, but lots of hyperbole articles because by definition coinflation people are pm people. On the other hand, the general media usually have hyperbole against pm ownership. I just read one on the WSJ yesterday. He used the highest point gold ever was at the show how its a bad investment. This is just as bad as pm pushers using the lowest pm has ever been to get you to buy it.

Be reasonable, only put a portion of your funds in pm. If you are going to hold long term buy physical pm as it has lower costs of ownership over time. Also think about security. I put mine in a bank sdb.

 

Amen Brother!

$10k gold and $150 silver is purely speculative - and usually comes from the mouths of late night info-mercial types SELLING you the gold and silver. Question the source.

Instead of reading what other people predict (including me - who has been doing pretty well with reading futures markets the last couple years)

Look at your own financial situation, what you see in the coming years and plan your sale/exit strategy.

Gold and silver are up ~30% (give or take) in the last year. It could go up, it could go down. It might be good to take some cash off the table and save it, enjoy it, or diversify and re-invest somewhere else.

Read what really is happening in the news instead of opinions and commentary, make your decisions based on where you see markets and economies going.

Don't make rash decisions. And don't be so anxious to sell that you accept the first lowball offer that comes in. Metals are going up, demand is strong.

If you sell, what will you do with the money? Do you need it? Or have you made a substantial amount that you feel a good idea to book the profits?

Cheers and good luck!

 

If I'm remembering correctly, he's planning to roll it into one of the ultimate high risk/high reward vehicles: a new business. To which I say, as someone who lacks the drive, ambition, and risk appetite for it, "more power to you!"

 

Lol. I've been running my own business for nearly 2 years now, buying, selling, and trading video games. I've been running it from home, though, using FB, CL, and last summer flea markets to reach customers. I've been at a steady balance point most of that time, making enough money to cover my rent and bills each month, and get new stock, but not enough to build to anything bigger. I think if I feed an influx of capital into it, to get beyond this balance point, I *may* be able to move into a thriving, growing business, rather than a month to month thing. Build some savings, and maybe get a permanent physical location.

 

I wouldn't even think of it as playing the herd. Rather, I just look around for wide spread gloom in the markets. When everyone is down on a market, it could be a cue that it's an ok time to pick up a little. That being said, please know, I do not call tops or bottoms. I simply look around for decent places to hop on. It was damn scary buying silver when it was at $15 and then at $14. Many of us were looking at it thinking how easily it could go to $10 or even $7, sticking us with 30-50% losses from there even. Having only bought 20oz at a time made it easier to sleep.

I don't consider there to be any objective media when it comes to bullion. The pro-bullion crowd is always selling something, be it the product itself, or newsletters. The anti-bullion crowd is trying to keep people out of bullion and in ridiculously high cost vehicles like mutual funds.

 

Having said that, there are alternatives. I think I pay 12 basis points for an S&P 500 index in my deferred comp program. Ridiculously high cost mutual funds are a self-imposed tax IMHO, unless you just have an incompetent 401k department at work.

But for your other comment, its never easy to try to "catch a falling knife". That is why I never try to call lows or highs either. I about had an ulcer in early 2008 buying stocks just to see them still fall after I bought. Your head may be right in investing, but its your stomach lining that pays the price.

 

On the subject of calling tops and bottoms, my investment guy once sent me a study of the so-called experts (the ones the media often quotes) to see how accurate they were on calling the market.

It came out just shy of 50-50. Same as a coin toss.

 

As far as getting bullion rounds or junk silver, in my opinion it's the same. Both are valued by the silver content. If there are some minimally valuable coins in the junk silver (ie some have collector value), then we aren't really talking about junk silver. With junk silver, it usually is just common date stuff that tends to be cleaned, scratched, dinged up etc. I knew someone who had walking liberty halves, common dates and low grades with minor problems, and he couldn't get more than the going rate for silver half junk silver. If both were priced the same for the same amount of actual silver weight, I'd probably go with junk silver. There's more trust of junk silver and it's less likely to be tested

 

thanks. Most of the stuff I am now thinking of getting rid of is common date, but XF to AU condition. I decided to start off by listing $300 face ($100 roosevelt dimes and $200 franklin halves) locally at $5000. that's about 10% to 15% over melt, depending on the day and hour lately, but we will see what happens. I think if I am going to hold some for sale for later, I'll hold the dollar coins for last. They hold premiums the best I feel.

 

Here are answers to your questions (just my opinion)....but I have quite a bit of bullion which I have purchased over the years (since the mid eighties when gold was around $275).

I think that it is best to buy bullion like eagles, maple leafs, etc. With the growing issue of counterfeit coins, selling commercial bullion may be difficult in the future. FV silver coins are definitely picked over and are of poor quality. Many are worn very thin and, remember, if you sell, it will be most likely by weight, not FV.
Numismatic coins are great, but do it as a collector, not an investor.

Precious metals fluctuate wildly. My advice if you are buying, pick a price you are comfortable paying and buy in small amounts over time. This target price will likely change over time. There was a time when I never would have dreamed of paying more than $500 for an ounce of gold or more than $10 for silver. I just bought some maple leafs when silver was around $15 and was very happy with the price.

I believe precious metals should be part of a diversified portfolio (and a relatively small percentage at that). If you want to invest to make money over the long haul, I would go with good mutual funds that invest in the stock market.

Finally, forget the ads and predictions. There are just too many variables in the world markets, including current events, that are impossible to predict.

Bottom line: Diversify your investments and invest over the long haul.