Updated: Nov 19, 2022
When purchasing silver bullion it is best to understand the spot price, premiums charged and liquidity. Armed with this information a buyer will be well equipped to make the most cost effective choice when selecting bullion coins, bullion rounds or bullion bars. There are numerous silver coins to collect that will ensure a rewarding and enjoyable hobby.
What is the spot price?
In a nutshell, the spot price of silver is the present price per ounce that bullion can be purchased and delivered today. It is derived from the nearest futures contract that has the highest volume and activity. This could mean the current monthly futures contract or one that is a few months in the future. There are numerous places to go online to obtain the current spot price of silver.
What are premiums on bullion?
For other products we would call it profit, with precious metals we refer to them as premiums over the spot price. The mint needs to make a profit for making the product. The authorized buyer/dealer needs to make a profit, the next dealer or eBay seller needs to make a profit - so the premiums keep increasing. There are also other factors that effect premiums including: supply and demand, the global economic outlook, cost of doing business, etc.
You get the picture, right?
Tip #1: Buy as close to the wholesaler or authorized dealer of the mint as possible. The greater the number of middle persons, the more costly premiums will be.
What is liquidity?
Liquidity is the measure of being able to easily buy or sell an asset at its intrinsic value. In the case of bullion coins, rounds and bars some would be very liquid, while others would be illiquid ( meaning harder to sell)
As a rule of thumb, sovereign bullion coins and ISO 9001:2015 certified rounds and bars are highly liquid. A short list of highly liquid silver products would include:
American Silver Eagles, Canadian Silver Maple Leafs, Britannia’s etc.
ISO accredited/certified bullion rounds ( Sunshine Minting, Mason Mint, Scottsdale Mint) *
ISO accredited/certified bullion bars ( Mason Mint, Sunshine Minting)*
Vintage collector/investor bars renowned for quality (Englehard, Johnson Matthey,* Not all mints were listed*
Medium liquidity or illiquid silver bullion products would include:
Non ISO certified bars and rounds
Specialty design rounds ( aliens, zombies, skulls, mythological or fantasy figures, custom business or private label, etc.)
If you plan on selling your silver some day it is best to purchase bullion in the highly liquid category. These are recognized bullion products that a respectable dealer or investor would be most apt to purchase.
Tip #2 As an investor or collector with a window to sell for a profit use highly liquid silver products
If you are a silver stacker or just collecting silver bullion with out the need or desire to sell any of the bullion products there are a diverse number of bullion products that will enhance your experience. It may be prudent to have a percentage of your bullion products in liquid products in case of an emergency.
Tip#3 There are some intriguing silver products in the market that are just really nice products, and its alright to add these to your collection. In the event of an emergency should some silver need to be sold ISO Certified 9001:2015 may assist you in this case. For example the Buffalo or Indian Head 1 ounce silver bullion round produced by private mints is valued at the spot price silver and have smaller premiums than bullion coins.
Bullion Coins - Issued by authority of a government and is considered legal tender. Produced with exacting measurements, containing 1 Troy ounce of .999 Fine Silver. Generally have higher premiums and will have premiums decrease slightly when purchased in bulk.
Bullion Rounds - produced by private mints, although some are designed after legal tender coins they do not have a denomination and usually contain the word “Copy” so as not to be considered counterfeit legal tender. Metal content is 1 Troy ounce of .999 Fine Silver. Premiums decrease based on number of rounds purchased.
Bullion Bars - .999 Fine Silver produced in 1oz., 10 oz., 100 oz. and 1000oz bars. Premiums decrease as size of bar increases.
Certified/Accredited 9001:2015 is required for a product to be eligible for an Individual Retirement Account (IRA)
Whatever the reason for purchasing silver the Millyard Team hopes you have found this information helpful. If you would like certain areas expanded with greater detail or have suggestions for improving this article please leave a comment. Good Luck and Enjoy the world of silver bullion.
Millyard Coins and Cards LLC is an authorized dealer for Mason Mint ( Certified ISO 90001:2015).