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The value of silver as an investment in UK


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Looking at silver bullion in the UK, I wonder if it is actually worth all the hassle.

to start with, the VAT on bullion adds a new layer of expense which also affects the second hand market. Leading to 1oz coins selling for £26 plus, well above spot.

For those who do keep their silver long enough to hit profit, the chances the beautiful coins are covered in milk spots or tarnish are high.

I love collecting silver, but have come to realise it is just a hobby. Keeping my fingers crossed my coins don’t end up milk spotting or tarnishing in their capsules.

These are my humble thoughts having recently entered the world of silver bullion and coins in general. 
 

I would welcome any one else’s input especially those who could convince me it is worth buying silver as a hedge or investment.

J

 

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I share similar concerns but can't ignore it completely.

If I could only choose one metal for some reason or I was starting now I would have to choose gold primarily but having first got silver a few years back starting from the low teens £ per oz it's a pro and a con... Makes it seem expensive now (partly due to higher spot but also premium % is higher) but puts a good bit of profit margin should I sell now. 

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1 minute ago, modofantasma said:

I share similar concerns but can't ignore it completely.

If I could only choose one metal for some reason or I was starting now I would have to choose gold primarily but having first got silver a few years back starting from the low teens £ per oz it's a pro and a con... Makes it seem expensive now (partly due to higher spot but also premium % is higher) but puts a good bit of profit margin should I sell now. 

When you bought yours for low teens, was that before VAT was applied to silver ? That is the major killer in my opinion. I wouldn’t buy a £100 share in a stock for £120 and I wouldn’t buy a £20 note for £25, but I’m happily ordering silver which includes the VAT either directly or in directly.

 

 

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If you want exposure to silver and believe in it rising. For pure investment purpose. You would be best buying something like ISLN on whatever broker app you use. This way you are buying £100=£100. 
 

If you want some physical for hobby that is different. 
 

One thing to note is these premiums can be passed on as long as you are not selling to dealers. But if you get to any sort of volume it will be hard to offload it all at peak price. 

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58 minutes ago, booboobear said:

When you bought yours for low teens, was that before VAT was applied to silver?

It was possible to get low £teens silver in recent years - i just dug out a sales invoice for 1 oz Somali Elephants from Silver-to-Go from September/October 2015 - it worked out at £12.60 an ounce.
That was in the days when you could get silver coins 'VAT free' and there was a special offer on these coins.

i got almost 57 ounces last weekend for $1300 on the Kinesis platform. 

Always cast your vote - Spoil your ballot slip. Put 'Spoilt Ballot - I do not consent.' These votes are counted. If you do not do this you are consenting to the tyranny. None of them are fit for purpose. 
A tyranny relies on propaganda and force. Once the propaganda fails all that's left is force.

COVID-19 is a cover story for the collapsing economy. Green Energy isn't Green and it isn't Renewable.

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1 hour ago, FlorinCollector said:

If you want exposure to silver and believe in it rising. For pure investment purpose. You would be best buying something like ISLN on whatever broker app you use. This way you are buying £100=£100. 
 

If you want some physical for hobby that is different. 
 

One thing to note is these premiums can be passed on as long as you are not selling to dealers. But if you get to any sort of volume it will be hard to offload it all at peak price. 

I agree the premiums are passed on, unless milking occurs which sees coins being flogged off much cheaper than minters.

another gamble I suppose. 
 

 

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3 minutes ago, GoldDiggerDave said:

You need to make your own financial decisions if you think about it anyone trying to convince you to do anything will most likely have their own motives.  There are too many YouTubers pumping their own agendas especially sponsored silver pushers.  

Silver as a hobby retains some value, better than spending money on computer games or fast and loose woman.  

Hedge against what, inflation?  This is where I would encourage you to do your own research look at silver over 2021  has it gained or lost value look at real world inflation, factor in VAT, dealer premiums, postage, storage  as a very rough guide if you buy a silver 1oz round today you need spot to increase 50% just to hope to break even, and you would still make losses if you had to pay to post it or drive somewhere to sell it.  

I'm a big fan of people being debt free, if you are making long term financial decisions look at working to be debt free by a given date.  Some of the best real world gains people can have is not paying interest or being a life long debt cycle. 

This post sums it up completely for me. Great perspective.

I will continue with silver as a hobby under no illusions it will probably lose me money.

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My crystal ball is baggered so I have no idea what will happen to silver in the future. I know that there will be a stock market crash followed by a stock market boom followed by another crash and another boom. I also know that inflation will go up and inflation will come down. And interest rates will go up and interest rates will go down.

By how much and in what time scales I have not got a clue and neither has any of us. History shows that not even the expert advisors to the lever pullers have a clue.

In the absence of any idea of what the future will bring and when, I will build a diverse portfolio of assets knowing that I wont be super rich nor super poor.

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Silver and PMs in general are fun and there is still money to be made as an investment. Some say its massively under valued, who knows. 

I feel like I spend a fortune on storage vs my gold and it does feel mad buying premium silver sometimes given the risks of it milking or tarnishing even after grading.

 

 

 

 

 

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2 hours ago, KevinFlynn said:

For wealth preservation, gold is where it's at, due to already stated reasons.

But silver is nice for collectibles and unique pieces which would be too expensive or too much of a risk in gold.

At least the way I see it.

 

So gold for investment and silver for pleasure. 

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16 hours ago, booboobear said:

So gold for investment and silver for pleasure. 

Exactly.

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Actually, there is an interesting story with the item on the left. I bought it at Hamley and Rowbotham's auctioneers in Poole, Dorset. It came with a huge wad of provenance and tells quite the tale.

An Edwardian piece, hallmarked sterling silver, dated 1906, and stamped in Birmingham where it tickled Lionel in the assay office (and Clive in accounts, allegedly).

This stunning objet d'art has been in and out of the same family for over one hundred years and now sits proudly on my mantle, lovingly embraced in a soft velvet cushion.

Too valuable now to serve its practical purpose, it has been retired after years of faithful service.

I plan to commission a silver pourer to knock one out for me later in the year.

Edited by Roy

Technically, alcohol is a solution..

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"There is no such thing as public money, there is only taxpayers' money"

Let not England forget her precedence of teaching nations how to live.

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I am less negative about silver as an investment than most of the people here. However it does depend on how you define investment, what your macro economical outlook on the future is and how much you might need the fiat currency you invested in it for other purposes. If you believe you can make some quick gains also known as day trading than silver will probably not be good investment. The costs and premiums are simply too high to quickly earn back. However as a 20 year or so investment where you manage the dollar cost average of it all still is not completely bonkers. Other assets at the moment are in my opinion way overvalued and a correction is coming. What this will do to gold and silver however is a big question and will depend a lot on whether the correction will take several leading currencies with it on a downwards trajectory and whether this will cause a switch to a world currency backed by something that maintains a certain inherent value. Gold and silver could be included in that but it is not certain that a breakdown of the world currencies will occur and if it does what will take it's place.
If the cost of everyday living will go through the roof you might also need fiat currency to keep being able to live at a certain comfort level. It is nice if your stack triples in value but if each time you need to spend an ounce to get a gallon of gasoline or a loaf of bread you will probably quickly run out of your investment anyway. Best to have some silver around for fun AND as an investment but don't expect it to be the best performing asset you have.         

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2 hours ago, Dawnbreaker said:

I am less negative about silver as an investment than most of the people here

It's not necessarily negative but more the great human desire of a good underdog story (and a obsession with shiny things). Unfortunately if you were to throw a dart in the random object generator and bought that 20 years ago, you would have had a return at a bare minimum of inflation. I am currently sitting at home watching pepper pig, so have a little time on my hands and generator came up with purse. 

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Silver 20 years ago? About 8 dollars, so slightly better than the above purse. Not necessarily poor but not a good investment either. 

 

 

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PM's especially silver is not an investment they are a speculation many people can not tell the difference.  When most say "long term"  that's code for taking losses they really don't want to admit or realising they may have to hold for several decades to hope to break even.

For people stacking silver over the last 5, 10 years longer has it paid off your mortgage or put your kids through university? I'd love to hear some success stories and hear how you did it, I'll be the first one to genuinely congratulate you.  

I'm not against silver, I hold it.  Reading people talk about it as an investment or even worse a hedge against inflation is total lunacy.   There is that day when all the stars align and silver jumps 1000's of time and I hope it does It will make me rich....... This ideology is not investing very quickly people start to describe a lottery and that what silver is a lottery.       

 

 

 

 

 

 

 

 

 

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7 hours ago, booboobear said:

So gold for investment and silver for pleasure. 

The way I see it, yes.

There is a narrative of silver waiting for a breakout (e.g. Mike Maloney), which promoted silver. Silver is also an acceptable investment in the US, where there's no VAT in most states.

But VAT is killing the idea in Britain and most of Europe. It used to be a viable idea, the Silver Forum used to import VAT free silver from the baltic states, (for me) Germany had only 7% on silver coins, but those times are gone.

I say you can put a couple kilos aside as a speculative investment if you're adventurous. If silver does explode, you will at least participate, but don't build your investment strategy on it. Getting some collectible coins will be nice and affordable in silver, if you can avoid milk spotting or tarnishing.

All in all gold does not have any of those problems. Fractional, or trade coins are good options for entry level investment. And if you want to speculate on silver maybe get paper silver.

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I started buying silver because of the people at my local Stand in the park groups gave me a crash course on PM. That’s how I found this forum and have been picking up tips and valuable information which has turned into a hobby of sorts. I have spread my silver purchases to pre 1920’s British coins/ .925 cutlery/ 1oz Britannia’s etc and physical silver stocks & shares. I plan to keep them for the long haul and hopefully leave to my children with the intention of silver increasing in value. 

REMEMBER BIG PHARMA WANT YOU UNHEALTHY TO MAKE MONEY FROM YOU 

SAY NO TO THE VAX - YOU CANNOT UNVACCINATE 

QUESTION EVERYTHING -  NEVER TRUST GOVERMENTS

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5 minutes ago, booboobear said:

For me, this is the worst part of silver as a collectible. Especially for someone like me who has mild OCD

I got a whole set of Queen's Beasts in silver (plus a couple extras). I put them into the vault and did not look at them. When I finished the set this year I got them together and found a certain level of whiffing or smudging. They're still okay if looked at from afar, but it's not a pristine set. Now I know it's only bullion, but the price development tells otherwise. At that moment I realized silver cannot be a serious investment for me.

I would still collect any reasonably priced bullion series if I liked it, because it's cheap enough. And I would get any silver at melt or even spot (wishful thinking).

I envy our american friends as silver is different over there. And I would love to stack more bars. Cast bars are a thing to behold, but cast gold bars are out of my investment range.

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