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Physical vs Mining stocks UK


Harged

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Hi all

 

Relatively new user here but especially for silver what is the actual benefit of holding physical silver in comparison to holding shares in a silver ETF or silver mining stocks?

Even just any large precious metal manufacturer in general?

 

If we weren't in the UK I probably wouldn't suggest this but the fact that the VAT has to paid on physical silver but doesn't have to be paid when buying stocks just seems to weight the option a large amount to buying stocks in my opinion. Do people agree with this? Holding the physical silver in your hand can be nice just like gold as it's real money but unless there is a total financial collapse of all internet banking surely stocks are better?

 

Let me know as I'm interested to hear some feedback :)  

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Individual stocks have no inherent value and make up a much smaller part of the overall picture. As such, this makes them far more prone to complete collapse. It really comes down to your investment strategy though in regards to which one makes more sense. For short term potential profit/active trading, anything virtual is going to be far more efficient in general - but risk will always be much higher, especially long term.

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7 minutes ago, SilverLoaf said:

Individual stocks have no inherent value and make up a much smaller part of the overall picture. As such, this makes them far more prone to complete collapse. It really comes down to your investment strategy though in regards to which one makes more sense. For short term potential profit/active trading, anything virtual is going to be far more efficient in general - but risk will always be much higher, especially long term.

Hmmm I suppose that makes sense in terms of paying the premium as insurance for the long term 

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3 hours ago, Harged said:

Hi all

 

Relatively new user here but especially for silver what is the actual benefit of holding physical silver in comparison to holding shares in a silver ETF or silver mining stocks?

Even just any large precious metal manufacturer in general?

 

If we weren't in the UK I probably wouldn't suggest this but the fact that the VAT has to paid on physical silver but doesn't have to be paid when buying stocks just seems to weight the option a large amount to buying stocks in my opinion. Do people agree with this? Holding the physical silver in your hand can be nice just like gold as it's real money but unless there is a total financial collapse of all internet banking surely stocks are better?

 

Let me know as I'm interested to hear some feedback :)  

Probably used to agree with you.

Individual stocks in theory can be traded at the push of a button. There is a whole different debate about liquidity of each, depending on shares in issue and exchange listed on. 

You are more likely to keep hold of physical holdings than paper for this reason alone but I also think it’s about spreading investment risk; the debate around if you can’t touch it, you don’t own it comes into play I guess for some. However, I just think it’s just another form of investment and now I’ve started a few collections, it turns into something of an hobby that also holds value.

Oh and yeah, there is also that bank collapse, barter trade argument if things get bad.

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4 hours ago, ZigZag said:

Probably used to agree with you.

Individual stocks in theory can be traded at the push of a button. There is a whole different debate about liquidity of each, depending on shares in issue and exchange listed on. 

You are more likely to keep hold of physical holdings than paper for this reason alone but I also think it’s about spreading investment risk; the debate around if you can’t touch it, you don’t own it comes into play I guess for some. However, I just think it’s just another form of investment and now I’ve started a few collections, it turns into something of an hobby that also holds value.

Oh and yeah, there is also that bank collapse, barter trade argument if things get bad.

Do people on here feel scared of bank deposits failing and such? That must be part of the reason to own physical metals at least.

Just for arguement sake say there is a situation where the banks fail and depositors lose money in their account. Would it matter if you moved that money over to a stocks and shares account brokerage for instance? I'm not sure who technically has to pick up the tab for that amount since the money transfered from your bank account to the brokerage is like the brokerage now has an IOU.

No entirely sure how it all works

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On 05/09/2020 at 21:44, Harged said:

Do people on here feel scared of bank deposits failing and such? That must be part of the reason to own physical metals at least.

Just for arguement sake say there is a situation where the banks fail and depositors lose money in their account. Would it matter if you moved that money over to a stocks and shares account brokerage for instance? I'm not sure who technically has to pick up the tab for that amount since the money transfered from your bank account to the brokerage is like the brokerage now has an IOU.

No entirely sure how it all works

If UK banks were to fail and people were to loose the money held therein, transferring your money to a brokerage account would be the least of your worries, roving gangs of disgruntled creditors and how to defend your spuds would be your main preoccupation.    

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On 05/09/2020 at 12:03, Harged said:

Hi all

 

Relatively new user here but especially for silver what is the actual benefit of holding physical silver in comparison to holding shares in a silver ETF or silver mining stocks?

Even just any large precious metal manufacturer in general?

 

If we weren't in the UK I probably wouldn't suggest this but the fact that the VAT has to paid on physical silver but doesn't have to be paid when buying stocks just seems to weight the option a large amount to buying stocks in my opinion. Do people agree with this? Holding the physical silver in your hand can be nice just like gold as it's real money but unless there is a total financial collapse of all internet banking surely stocks are better?

 

Let me know as I'm interested to hear some feedback :)  

Definitely worth having some precious metals as well as other investments. Nothing wrong with having a store of wealth outside of the corrupt banking system. Just my opinion though. My non bankIng store of wealth has easily amounted to more than the vat I’ve paid on it at the time. Shop around for good deals. Makes me save better to be honest. Have fun in what ever you choose. 👍

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It is probably wise to think of precious metals and mining shares as different things. Precious metals are insurance, or even a form of money. Mining shares are a speculative investment that should be made only with money you can afford to lose. You can pick individual mining companies, or there are ETFs of silver miners, such as SIL and SILJ.

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