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Silver Bullion Bars

As we have already seen, it seems likely that silver will be in short supply in the medium to long term, and therefore as an investment will almost certainly provide excellent returns. So should you as an investor be considering silver bullion as one of your options, and in my view the short answer is yes. Now before you begin to search the internet for bullion dealers and suppliers, there are a few basic facts that you should consider before going ahead, and these are the same as for purchasing any form of bullion including gold.

Firstly most dealers will demand to see silver bullion bars before they buy them because of counterfeiting concerns, which means you will have to transport your silver to the dealer to start the selling process. As prices rise in any market they will always attract the opportunistic element looking to make a quick return, so you need to be wary. Some will not buy bars without an assay, which is a chemical analysis that determines the silver’s purity. You as the owner of the silver will generally be expected to pay for this process as part of the sale. In most cases, silver firms will not set a price until after the bars have been delivered to their location or depository for inspection. In the same manner, bullion bars can also present problems for those wanting to trade silver for goods, because the individual receiving the bullion has no way of knowing whether the bars are real or fake. Because of these potential trade and exchange difficulties, smaller investors are often advised to fore go the dream of bullion bars, for the convenience and liquidity of silver bullion coins. For larger investors however, silver bullion bars can and do play a part in the portfolio, not least because it provides a more cost effective way to purchase larger quantities at a rate closer to the spot silver market price.

Silver bullion bars, which are often also referred to as silver ingot bars, normally consist of silver with a fineness of 0.9999, in other words the bar or ingot is 99.99% pure silver, and generally available in sizes from one ounce up to 5000 ounces, with a variety of sizes in between! The 1,000 ounce silver bullion bar is the standard industry unit and traditionally used for trading and storage, but can also be taken for personal delivery. The most popular weights with investors are the 10 ounce and 100 ounce bars, the latter of which are often referred to as “investment” bars, as they are the most popular for investment purposes. The prime reason for their popularity is threefold. Firstly, they provide a very cost effective way of investing in silver, since the dealers mark up is relatively small on a per ounce basis over the silver spot price, secondly they are not too heavy to ship, and finally they are a compact size for storage. ┬áIn terms of the mark up from the spot price of silver, you should be able to find these from around $0.99 per ounce above the silver spot price, but you will have to shop around.

The next issue to consider as a silver bullion investor, is that of the refiners mark. As in any market some names are more respected than others, and the same is true within the silver bullion market. My top recommendations therefore would be as follows : Johnson-Matthey, Engelhard, Royal Canadian Mint, Wall Street Mint, Sunshine Mining, The English Sheffield and Handy & Harman, of which the most popular are the first two. However, both Johnson-Matthey and Engelhard both ceased large volume production in the late 80’s, so these bars are not easily available. However they are worth seeking out, as their value is both in the name and also the intrinsic value of the silver. As a company Johnson-Matthey has been in business since 1817, and as such has an unrivalled name in the market, allowing buyers and sellers to trade with complete confidence, both in the product and the name stamped on the bar, so as I say they are well worth the effort to find if you can and when you come to sell, you will of course have a ready market waiting to buy. All Johnson-Matthey silver bars are stamped with the precise weight and a unique serial number.

The same applies to the Engelhard mark which again will ensure that you can buy with complete confidence, knowing you are buying a very high quality silver bullion bar, with a great name stamped on it, so that when you come to sell it will command the best price possible. Like Johnson Matthey they are one of the oldest names in precious metals and with a reputation throughout the world for one of the highest quality silver bullion bars available, so again you can buy with complete confidence. English Sheffield bar and Handy & Harman, again are both more difficult to find, but again well worth the time and effort to uncover. All the others you will find to be more easily available, but as always quality will always pay off in the long term, so please do your research and homework for the best investment choice. Buying silver bullion bars, is like any other form of investing in that you need to do your research carefully, before investing, and not regret the decision afterwards. As I have said several times, I believe silver presents an excellent long term investment opportunity so there is no need to rush – the silver bullion dealers will be there today, tomorrow and next month, and the more information you have the better the questions you can ask when it comes to buying. If the dealer sees you are a knowledgeable buyer, you are far more likely to come away with a better investment, so take your time! Finally remember that if you are proposing to invest in silver bullion in a large way, then you may well need to consider the storage aspect in more detail – At current prices an investment in silver would be around 50 times the volume and weight of the equivalent investment in gold, so you may want to consider this carefully!!