€5000.00 Euros On Silver Or Gold? Advice Needed.

[Organics]

So I have been stacking for a number of years now, purely for long term investment purposes. My stack is about 80/20 Silver to Gold. So last week I was offered some bullion gold coins just under spot, which came to a total of around €5000.00. So I was just about to accept the offer when this came up. Yesterday I was offered 190, Silver, 1oz Bullion, .999 coins, dating from 1999 to 2022. The seller had a mixture of what I call normal investment coins (which make up the majority of my stack), i.e Maple's, Eagles, Britannias, Panda's etc, etc, but also loads of collector, limited edition, and proof coins (which I have none of). They all come in plastic capsules and no boxes or certificates unfortunately. He is doing them all for €5000.00 as he wants to sell the collection as a whole. Some of these coins are worth substantially more than €26 each, but I just don't know if I want, or actually need more silver. I have to make a decision on this by the close of play today as he has some else interested. 

So what would you do in this situation? I'm usually quite good at making decisions like this, but I see the ups and downs to both purchases, and keep going around in circles. I always find the advice on here sound, so am reaching out for some clarity. 

5K in Silver or 5K in Gold?

[JamesH]

With spot where it’s at currently, if you’re being offered bullion a shade under, that sounds to me like the deal I’d be taking. That said, I guess more detail on what billion coins you’re talking about might help but assuming it’s to stack for the long term and happy to exit either privately or to a dealer when the time comes, then close to spot gold will be a likely winner 👍🏼

[AOB]

1 minute ago, JamesH said:

With spot where it’s at currently, if you’re being offered bullion a shade under, that sounds to me like the deal I’d be taking. That said, I guess more detail on what billion coins you’re talking about might help but assuming it’s to stack for the long term and happy to exit either privately or to a dealer when the time comes, then close to spot gold will be a likely winner 👍🏼

I totally agree with @JamesH the gold at spot seems more appealing - and would be my choice especially if holding for the long haul  

[Cassius]

5k gold under spot it might be a good deal. For now the forecast for spot is that it will go a bit down for the summer. Summer is always the buyer market. How much further down it can go? Nobody knows, but assuming it can hit the 47£ / gr to late August/September ( now is 49£) , for the long term as in keeping that gold minimum 5, 7 years, you might have a good deal on your hands. There sre still bank runs to come, higher intrest rate to follow, a bit of inflation as well, so...mainly logic says gold will go up. 

[Organics]

9 minutes ago, JamesH said:

With spot where it’s at currently, if you’re being offered bullion a shade under, that sounds to me like the deal I’d be taking. That said, I guess more detail on what billion coins you’re talking about might help but assuming it’s to stack for the long term and happy to exit either privately or to a dealer when the time comes, then close to spot gold will be a likely winner 👍🏼

Thanks for your response. I’ll add some pictures now of the silver bullion I have been offered 🙏

6 minutes ago, AOB said:

I totally agree with @JamesH the gold at spot seems more appealing - and would be my choice especially if holding for the long haul  

Thank you 🙏 

[Organics]

1 minute ago, Cassius said:

5k gold under spot it might be a good deal. For now the forecast for spot is that it will go a bit down for the summer. Summer is always the buyer market. How much further down it can go? Nobody knows, but assuming it can hit the 47£ / gr to late August/September ( now is 49£) , for the long term as in keeping that gold minimum 5, 7 years, you might have a good deal on your hands. There sre still bank runs to come, higher intrest rate to follow, a bit of inflation as well, so...mainly logic says gold will go up. 

Thank you 🙏 

[Organics]

Just some of the silver I have been offered. However it seems like gold is in the lead 🙏

[Organics]

14 minutes ago, AOB said:

I totally agree with @JamesH the gold at spot seems more appealing - and would be my choice especially if holding for the long haul  

Thanks. I tend to sell only when I need an extra bit of cash. Never to cash in on profits. So my goal is always long term. I’ve always liked silver as it’s so more accessible to buyers in terms of price, not availability. 

[Organics]

25 minutes ago, JamesH said:

With spot where it’s at currently, if you’re being offered bullion a shade under, that sounds to me like the deal I’d be taking. That said, I guess more detail on what billion coins you’re talking about might help but assuming it’s to stack for the long term and happy to exit either privately or to a dealer when the time comes, then close to spot gold will be a likely winner 👍🏼

Thank you. I’ve uploaded some photos of the silver, to give you an idea. Obviously at €26 an ounce, the silver is above spot, and the gold is under, by about 2%. 

[DTL1982]

It would be the gold for me if I were in your situation.
 

I collect silver bullion coins but don’t care for the colorized ones so that would be a no-go for me anyway. Also, I generally view gold as a better store of wealth. Silver is more for collecting and having some diversity.  

[Organics]

1 minute ago, DTL1982 said:

It would be the gold for me if I were in your situation.
 

I collect silver bullion coins but don’t care for the colorized ones so that would be a no-go for me anyway. Also, I generally view gold as a better store of wealth. Silver is more for collecting and having some diversity.  

Thank you 🙏 

[Minted]

It would be the gold for me as well. 

Silver is quite bulky to store at that sort of value and still at a fairly large premium.  Lack of boxes and certificates reduces the value and amount of buyers for the collectable items.

Must admit, there are only about 3 or 4 coins that I'd want to collect myself out of those pictured.  With the coloured Krug, has the colour shrunk on it?  I've got a few coloured silvers myself but am concerned about the longevity of the colour.

[Organics]

14 minutes ago, Minted said:

It would be the gold for me as well. 

Silver is quite bulky to store at that sort of value and still at a fairly large premium.  Lack of boxes and certificates reduces the value and amount of buyers for the collectable items.

Must admit, there are only about 3 or 4 coins that I'd want to collect myself out of those pictured.  With the coloured Krug, has the colour shrunk on it?  I've got a few coloured silvers myself but am concerned about the longevity of the colour.

Thanks for the response. That's the down side to Silver. It's heavy to move a large quantity around and the space it takes up. However it is still much more accessible to most buyers than gold. Unless fractional gold and then you're paying a higher premium. I've not seen the coins in Person yet and with the advice I'm getting, unlikely too. However everything I saw looked to be good. I guess in the ideal world I'd buy both 🤪

[HonestMoneyGoldSilver]

The coins pictured are worth more than €26, some a lot more, some not much more. I wouldn't get carried away with colourised versions as while they are certainly worth more they are in the numismatic sphere which reduces your potential market relative to standard Kooks, Star Wars, Pandas, Libertads, etc

For me the main issue is your goals, motivations and risk tolerance when running a 20:80 gold/silver ratio. I am very bullish on the mid-to-long-term silver market, more so than the gold market, although I also expect significant appreciation in gold. I tried to be sensible when I started stacking a few years ago and exclusively bought gold. Since then I've been buying mostly silver and my ratio is currently about 60:40 gold/silver. My goal is 25:75 gold/silver so I've a lot more silver to stack. I'm planning on adding 5-10 more ounces of gold before end of 2023, so I need to buy 1,000+ ounces of silver, I've just got the slight issue of finding the cash to pay for it all 😂

It's commonly preached that a defensive investor will hold a 2:1 gold/silver ratio - i.e. £100 invested = £67 gold and £33 silver (at spot prices). A cautious investor may prefer 8:2 gold/silver. An aggressive investor (seeking alpha) holds roughly the inverse of a defensive investor, so a 1:2 gold/silver ratio - i.e. £100 invested = £33 gold and £67 silver. You are currently running the inverse of a cautious investor, placing you in the very aggressive range of 2:8

Personally I have no problem running that ratio and that's roughly my end goal (25:75 gold/silver). Are you happy being that aggressive though? Are you fully cognizant of the risks you are taking and the potential rewards? What are your mid-to-long-term target prices for gold and silver? How robust are your estimates? 

Sounds to me like both deals are attractive. As @Cassius stated, the summer months are typically the low-point for precious metals (stacking and collecting are indoor sports). Which metal do you calculate to have the most downside? By my estimation, I can see gold retracing to a bottom of $1850 while the bottom for silver is $20. That means gold might lose 5% before the major rally at the end of 2023-25. Silver might lose 15% before a monster bull rally. Are you happy to lose 15% of your investment with the potential for larger future gains? Or do you prefer the security of "only" losing 5% and having slightly lesser potential for future gains but greater insurance and stability? 

If it were me in your position I'd definitely be wanting to add more gold sooner rather than later but I can also see the attraction in buying more silver.

It might take a bit of work but if you can calculate a conservative estimate on all those silver coins and work out if the discount you are getting on the more premium/numismatic items is enough to cover the potential 15% drop in silver, then I would seriously consider the silver deal. The gold deal is extremely attractive depending on your investment goals especially if you're getting it 2% under spot. Ideally you'd buy both 😁. I would pay attention to the ratio you are running and make sure it aligns with your risk tolerance and long-term goals. 

[Organics]

29 minutes ago, HonestMoneyGoldSilver said:

The coins pictured are worth more than €26, some a lot more, some not much more. I wouldn't get carried away with colourised versions as while they are certainly worth more they are in the numismatic sphere which reduces your potential market relative to standard Kooks, Star Wars, Pandas, Libertads, etc

For me the main issue is your goals, motivations and risk tolerance when running a 20:80 gold/silver ratio. I am very bullish on the mid-to-long-term silver market, more so than the gold market, although I also expect significant appreciation in gold. I tried to be sensible when I started stacking a few years ago and exclusively bought gold. Since then I've been buying mostly silver and my ratio is currently about 60:40 gold/silver. My goal is 25:75 gold/silver so I've a lot more silver to stack. I'm planning on adding 5-10 more ounces of gold before end of 2023, so I need to buy 1,000+ ounces of silver, I've just got the slight issue of finding the cash to pay for it all 😂

It's commonly preached that a defensive investor will hold a 2:1 gold/silver ratio - i.e. £100 invested = £67 gold and £33 silver (at spot prices). A cautious investor may prefer 8:2 gold/silver. An aggressive investor (seeking alpha) holds roughly the inverse of a defensive investor, so a 1:2 gold/silver ratio - i.e. £100 invested = £33 gold and £67 silver. You are currently running the inverse of a cautious investor, placing you in the very aggressive range of 2:8

Personally I have no problem running that ratio and that's roughly my end goal (25:75 gold/silver). Are you happy being that aggressive though? Are you fully cognizant of the risks you are taking and the potential rewards? What are your mid-to-long-term target prices for gold and silver? How robust are your estimates? 

Sounds to me like both deals are attractive. As @Cassius stated, the summer months are typically the low-point for precious metals (stacking and collecting are indoor sports). Which metal do you calculate to have the most downside? By my estimation, I can see gold retracing to a bottom of $1850 while the bottom for silver is $20. That means gold might lose 5% before the major rally at the end of 2023-25. Silver might lose 15% before a monster bull rally. Are you happy to lose 15% of your investment with the potential for larger future gains? Or do you prefer the security of "only" losing 5% and having slightly lesser potential for future gains but greater insurance and stability? 

If it were me in your position I'd definitely be wanting to add more gold sooner rather than later but I can also see the attraction in buying more silver.

It might take a bit of work but if you can calculate a conservative estimate on all those silver coins and work out if the discount you are getting on the more premium/numismatic items is enough to cover the potential 15% drop in silver, then I would seriously consider the silver deal. The gold deal is extremely attractive depending on your investment goals especially if you're getting it 2% under spot. Ideally you'd buy both 😁. I would pay attention to the ratio you are running and make sure it aligns with your risk tolerance and long-term goals. 

WOW! Thank you 🙏 That's some response and one that I need to respond too in full. 

When I started stacking I never had a strategy, and to be honest I don't really have one now 🤷‍♂️. I just knew I didn't want to keep my money in the bank, and didn't want to just go on wasteful spending sprees, holidays etc. So although I did go on a spending spree, I decided that I should go all in on PM's. I didn't want to buy stocks and I dipped my toe into crypto, but that was about it. I had no real idea what I was doing, and all the advice I got at the time was from the dealer in Germany, where I bought the majority of my bullion at the time. 

I have never really worried about dips in the spot (paper) price, because I have a long term view, and more than likely hand the stack over to the children. So it's a savings policy more than anything. Whenever I get some extra funds, it goes into PM's and I just forget about it. no strategy per se. 

It's for this reason I was interested in the Silver deal, because he was offering numismatic coins (which I never buy) which sell for €40 and upwards, all for €26. I understand the lack of certificates and boxes for those is an issue, and perhaps why he's selling at that price. I can't get normal silver 1oz bullion coins over here for less than €30. So I didn't think it was too bad. However as mentioned above, silver takes up a lot of space and is heavy. If the SHTF and we need to move quickly (for whatever reason), then it's a huge hassle. I also like the fact that I can move around quite freely with this in my pocket (a €5000 Monnaie De Paris Gold coin) which is one of the gold coins I have been offered for €4500. The only thing is, the face value is only redeemable in France and it's not very liquid. Not many people with 5k lying around (myself included), in comparison to silver. 

So there are pros and cons to both options, but having read all the responses so far, my feeling is to go with the gold and try and balance out my stack a little. 

Thank you so much for taking the time. Much appreciated. 

🙏

 

 

 

 

[Antwerpstacker]

Buy the silver,flip the premium coins on here until you have your 5k back. Keep the remaining silver and buy 5k worth of gold...

Edited June 20, 2023 by Antwerpstacker

[Organics]

2 hours ago, Antwerpstacker said:

Buy the silver,flip the premium coins on here until you have your 5k back. Keep the remaining silver and buy 5k worth of gold...

Now why didn’t I think of that 🤷‍♂️. Thanks for suggestion but both deals had to be decided on by today. The Gold won 👍

[Fenlander1]

Congratulations great choice.

[HonestMoneyGoldSilver]

10 minutes ago, Organics said:

Now why didn’t I think of that 🤷‍♂️. Thanks for suggestion but both deals had to be decided on by today. The Gold won 👍

Beautiful coin. You can never go wrong buying gold 😍

Despite being called, "The SILVER Forum", this forum is full of people who only buy gold 🤷‍♂️

A lot of posters here are biased against silver and would tell you to buy gold even if the silver was free 😂

[Organics]

44 minutes ago, Fenlander1 said:

Congratulations great choice.

🙏🙏🙏

[Organics]

34 minutes ago, HonestMoneyGoldSilver said:

Beautiful coin. You can never go wrong buying gold 😍

Despite being called, "The SILVER Forum", this forum is full of people who only buy gold 🤷‍♂️

A lot of posters here are biased against silver and would tell you to buy gold even if the silver was free 😂

😂