An investing in Silver is an investment in a valuable asset that you can take possession of whenever you want. It can protect your portfolio from inflation and market volatility, and it’s a good way to squirrel away wealth if you’re worried about an uncertain future. Silver holds its value well, and will generally gain in value over the long term, which is perfect if you’re looking for an investment you want to hold onto for 20 or 30 years.
But investing in silver isn’t all about buying silver coins and bullion bars. Sure, you can go the traditional route and buy physical silver. Lots of people like the feeling of holding silver bars or coins in their hands and keeping them at home in a vault or safe. Some investors even love going to a brick-and-mortar bullion dealer or coin shop and picking out their latest investments. But you can also invest in silver stocks, mutual funds, and exchange traded funds. Here’s what you need to know.
Physical Silver Should Be Stored Securely
If you’re going to invest in physical silver, like coins and bullion bars, you need to make sure you’re prepared to store it securely. Many investors like to store their silver coins and bars in a safe at home, but you’ll need to protect your investment with insurance. You may be able to add a rider to your homeowners insurance to protect silver you have stored at home.
Another option is to have your silver stored in a depository. If you don’t have room at home to store your silver — and it can add up pretty quick — a depository might be the answer. You don’t have constant access to your silver, so if you’re buying to protect your wealth from political or civil unrest, but if you plan to hold onto your silver as a long-term investment and don’t need dividends or other returns in the meantime, storing physical silver in a depository may be the most secure way. You can usually get a buy-and-store deal from most online silver dealers, which means that your silver will be transferred to secure storage after you buy, with a continuous chain of custody that will make it easier to sell.
Buy Silver in Small Increments
Silver is the most affordable of the precious metals, which makes it an accessible investment vehicle for ordinary people. But ordinary people don’t tend to buy huge bars of silver — those kinds of purchases are usually made by funds, banks, and other institutional investors.
As a result, it can be hard to offload large bars of silver. If you’re buying physical silver, it’s better to buy smaller ounce amounts. A 5 oz silver bar will be easier to sell than a 100 oz bar, and a 1 oz silver coin even easier still. These are the kinds of amounts that individual investors are looking to buy, so there’s a bigger market for them.
Silver Stocks, Funds, and Bonds Offer More Liquidity
Silver is intrinsically valuable, so it holds its value even when inflation devalues the local fiat currency. It can be more volatile than other precious metals, specifically gold, because, while gold serves primarily as an investment vehicle, Investing in Silver has a range of applications in industry and it’s also used in currency and jewelry. The price of silver will hold stable or rise as industrial demand for the metal goes up, but if industrial demand goes down, the price of silver could go down, too. However, if given a decade or three, the price of silver will almost always go up.
However, you might not want to wait 30 years to see returns on your investment in silver. You might want to add some silver to your portfolio without the need to worry about storing, insuring, and selling physical bullion and coins. The answer is to invest in what’s known as “paper silver” — stocks, bonds, and funds that invest in silver mining, silver streaming, and silver futures. You can even choose funds and bonds that invest in physical silver.
Silver stocks and mutual funds pay dividends, so you won’t have to wait until it’s time to sell your silver to get some money out of it. An investment in a silver mine or refinery can yield returns in line with the growth of the company, just as you would from any other stock holdings. Stocks in silver mines or shares of mutual funds that invest in Investing in Silver and production can give your portfolio the hedging benefits of silver with a returns schedule closer to that of a traditional stock market investment.
Silver is a great investment to diversify your portfolio, and with silver trading at a significantly better price than gold or other precious metals, it’s an accessible choice to protect your wealth from inflation and market instability. Whether you choose to invest in physical silver or stocks and funds, you won’t regret adding Investing in Silver to your portfolio.