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Investing

Silver Investment Vehicles

Yesterday I posted about the benefits of investing in silver.  Today, I will expand a little about the different silver products one can get involved in as well as provide a decent list of alternative places where one can procure themselves whatever silver product they may be interested in.  I personally don’t chose banks for such transactions but I understand to some, banks may provide this added comfort level for such a purpose.

Anyhow – coins and bullion are not the only way one can invest in silver products.  Here is a comprehensive list as well as a brief explanation (and where applicable) a picture:

Bullion


These are silver bars at least 99.9% pure

Official Coins


Silver coins which are issued by a government mint

Medallions


Resembles a coin, but is not considered legal tender.  They may be issued by government or private mint.  If you go to the Royal Canadian Mint, you will see that they require a minimum order of 10,000 units (whoa!)

Certificates or Storage Accounts

Piece of paper which can be redeemed for the amount of silver it is purchased for – in the past these used to be legal tenders – not anymore.  On top of that, here is a link to a forum describing the tribulations of owning a TD Bank silver certificate (as much as I like TD – my favorite bank actually, I am not going to provide them with any kind of precious metal business)

Futures and / or Forward Contracts

An agreement made on an exchange to take or make delivery of silver at a set date in the future.  Personally I’m not a big fan of these as this is essentially speculation – I don’t mind the speculation on junior mining companies, but on precious metals – it’s a bit … anti-climactic in my opinion

Options

The right, but not an obligation to buy or sell silver or a financial security linked to silver on a specified date in the future.  Not a big fan of this option here as well since this is something that may or may not materialize – and you’re betting on what the price may / may not be in the future.

ETF (Exchange Traded Fund)

This is usually a mixed bag of silver goodies made up of silver-dependent stock market equities such as the physical metal itself, producers, refiners, a bunch of relatively safe speculative junior miners for good measure which you can purchase on the stock market for a set “stock” price.  Not a big fan of this unless you wanna park your money here for safe-guarding.

Mutual Funds

Fund which holds a basket of silver-related equities that are priced once daily.  Not a big fan of these either since in my opinion they are good to park your money for safe-keeping.

Accumulation Plans

Basically an investment strategy which allows to keep acquiring silver on an average basis with the difference that the investor does not actually own the physical silver.

Finally, here is a list of companies, contact information and what they offer to their clients for you to chose from – should you decide to get yourself some silver:

American Precious Metals Exchange:  bullion, official coins, medallions
The Bank of Nova Scotia:  bullion, official coins, medallions, certificates, futures
BlackRock:  ETF
CMI Gold & Silver Inc.:  bullion
Commerzbank, NY:  official coins, futures, options
Dillon Gage:  bullion, official coins, medallions, certificates
Fidelitrade:  bullion, official coins, medallions, certificates, accumulation plans, futures, options
Johnson Matthey:  bullion
Kitco:  bullion, official coins
Mitsui & Co (USA):  futures, options
Monex Deposit Company:  bullion, official coins, certificates, accumulation plans
MTB Bank:  bullion, official coins, medallions, certificates
Royal Canadian Mint:  bullion, official coins, medallions
SilverSaver:   bullion, official coins, medallions, certificates, accumulation plans
United States Mint:  bullion, official coins

M.

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About Michael W.

Project Manager for a large financial services company. Non-denominational closet investor. Entrepreneur running a small shop with a big idea

Discussion

One thought on “Silver Investment Vehicles

  1. Bullion FTW!

    Posted by Paul | May 25, 2011, 13:15

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