Physical Gold & Silver – A Preferred Investment Mode

Investors, who plan to invest in gold and silver keeping in mind the impending international financial crisis due to fiat currency, need to stay alert to some of the modes of investment in gold and silver.

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Modes of Investment in Gold & Silver

Numismatics
Pools and Certificates,
Futures & Options
ETF’s

According to some international financial analysts the above stated modes take investors towards false ownership of gold and silver as against the actual physical metal control.

Numismatic Coin versus Bullion Coin Purchase

Some economists are of the opinion that numismatics coin purchases are to be avoided for the premiums charged on them are way beyond their metal content.  These coins when flooded into the market along with bullion coins fall behind the latter in the premium rate race. The premiums of bullion coins are seen quadrupling as against the numismatics; the numismatic premiums are seen at astonishing lows when compared with the bullion counterparts.  Purchasing numismatics could also have one  paying far more for their antique nature instead of the metal content .The bullion coin prices worldwide are fixed based on their actual spot prices, whereas the numismatics are given a value based  on their  antique status alone.

Pools and Certificates

When one invests in a bullion pool or certificate, one becomes a creditor of the bullion bank storing the precious metals. Legally, a gold pool or certificate program makes the bank become the owner of the investor’s precious metal. If the bullion bank goes under financially, it can sell the investor’s gold to maintain its assets to avoid its own closure. In order to keep a check on one’s precious metal one could save it in vault storage. This would help the investor keep his metal segregated from the rest and also enjoy a name allocation; this way, if the bank went under the investor’s precious metal would remain safe.

Futures & Options

Futures and Options give an investor leverage that can magnify his loss and gain. If the commodities exchange were to default, it can change the rules to allow liquidation orders only. In this eventuality, an investor holding futures with it would be forced to accept cash payments instead of physical gold and silver, as the future designates to him.

Gold ETFs / Silver ETFs

Many metals experts are of the view that silver ETFs and gold ETFs may hold less than the amount of precious metal they supposedly should be owning or none at all.

Economists state  that for  most precious metals investors, the bottom line for  keeping  hard-earned wealth in precious metals is to own a physical asset that can tide over  any economic instability. However, wealth in ETFs makes the investor an unsecured creditor of a mega-bank which can devour wealth in the face of a financial crisis.

As is the case, in  an electronic or paper form of investment , the investor can be denied access to the value of his or her gold ETF or silver ETF shares due to acts of god, war, confiscation, computer glitches, fraud, insolvency, lawsuits, liens &  garnishments.

Given these for warnings , coupled with the very real possibility that silver and gold ETFs are not backed by physical gold or silver, investing in real, physical gold or silver should always be the preferred option.

Leverage Accounts

Leverage can dramatically increase an investor’s investment margins and it can be great for those educated in proper techniques and skilled in their use.

But for those in the unaware realms, leverage could also enhance losses to a 100% if not more. It’s as simple as this: leverage and risk go hand in hand.

Online Cheats / Dealers

Last but not the least one has to be vary of cheats doing gold and silver investment deals online.

Jindal Bullion Ltd, are retail/ wholesale traders who specialize in online booking for physical gold and silver all over India. Jindal Bullion is a reputed due to the years invested by them in the precious metal trade.  They stand for guaranteed purity of metal which is BIS hallmarked

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Silver Bullion- An Investor Prerogative or Not!

Questions that come to an investor’s mind when we think of silver as a portfolio investment metal are why, how & where? The answers that we now choose to give the investor are food for thought and introspective decision making.

To answer the why of the statement: When an investor moves into the arena of silver investments, he moves into tangible asset investment instead of paper currency. It saves him from the risks he might run with the latter. The affordability of the precious metal widens the investment base for it, incorporating and providing many more the opportunity to become investors. An ordinary man’s insurance’ is what silver is, for history has revealed that whenever there has been economic instability, those possessing the metal have accrued benefits from it.

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Another important aspect why silver should be invested in is the reality of false abundance of silver that one notices in the form of paper investments, though the actual physical presence of the metal is quite limited. The future, keeping the current situation in mind, is likely to see a rise in the price of silver, thus making it a profitable investor choice. Of the total silver available on earth only 35 % is actually mined for; making it a sought after future investment. Its industrial consumption keeps it ever high from the selling point of view and therefore an attractive investment option for seasoned investors.

The next thought that would automatically come to an investor’s mind, once he has ventured into the silver business is the form in which to purchase the metal. The answer to this is simple: Bullion, coins & rounds.

Collectible Coin

Of the three, coins are the best when it comes to investments because they can be stored without much trouble, have collectible and melt value, which fluctuates every day. Silver bullion is for those who can buy low and sell at a high price. The next query that comes to mind is where one can go looking for them. The answer is simple, to credible and reliable outlets and online traders of silver bullion & coins. Jindal Bullion is one such physical and online Indian outlet that provides the buyer of silver- credibility and security of purchase.

When is the Right Time to Buy Silver Bars?

An important question for those trading in silver. The year 2015 has not been a good year for commodity investments, particularly silver. It has witnessed a low since April 2011. However, this could be taken as a time to buy low, keeping in mind the rarity of the metal. However, major investments in silver are unlikely to happen, particularly, if rate of interests around the world begin to take on a strong foothold in the coming years.

Therefore, the word of caution would be -buy silver coins.

This is The Right Time To Invest in Silver Bullion/Bars

Decreasing silver supply is the best reason for investor owns it. There is not much of this white metal left for the retail buyer, and to find it is getting even more difficult. The industrial consumer is bound to feel the paucity of silver soon. Investors are running behind time already, when it comes to silver investments.

Short Source of Silver

This is best prior to the industrial revolution the production of silver was higher than its consumption, however after it, notions have changed; the investors have been alerted about it, and the price salvo fired.

Silver today is rare as compared to Gold, a fact still being overlooked by investors due to the fascination that gold enjoys… Attraction apart, buy silver bars is also an industrial commodity, which silver is, thus making it a much needed metal; therefore, investors need to alert themselves to this diminishing metal.

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If one was to presume that investor alert is inversely proportional to product price, it is easy to understand why gold remains the preferred investment. It trades 50 times higher than silver and traders somewhere still believe it to be the rarer one.

However, reality is that gold is 200 times in quantity than silver, today.

The Economic Impression

Economy does not affect silver supply. When economies are strong silver production is pushed due to increasing industrial needs and depleting inventories; this in turn leads to annual deficits and raised price. In times of weak economies, base metal production slows down, resulting in lower silver production the world over.

Mining is a costly endeavor; however, 65% of silver production is dependent on other metal production .Therefore, production of silver cannot be increased without disintegration of other mining activities; in other words, overproduction of copper, lead and zinc.

In Coming Times

The world’s silver inventory has been depleting since the past 60 years and the world has collectively, only recently, begun to see silver as a good investment.With rising premium and dwindling retail supply, investors still have time on their side. They have to remember that the best form of silver they can own is physical and that which is in their personal possession.