Tag: SLV

How to Invest in Gold, Silver, and Copper Bullion Without Buying Gold, Silver, and Copper Bullion

by Fred Fuld III

While gold, silver, and copper bullion can add diversification to your portfolio, there are some drawbacks to consider:

  • Storage Costs and Security: Physically holding these metals requires secure storage, which can be expensive,especially for larger quantities. Home insurance may not cover them, so you might need to rent a safe deposit box.There’s also the risk of theft if you store them yourself.
  • Liquidity: Selling physical bullion can be slower than selling stocks or ETFs. You may need to find a buyer willing to pay a fair price, especially for copper which has a smaller market.
  • Costs Associated with Buying and Selling: There are markups on buying bullion, and fees associated with selling it. These can eat into your profits, particularly for smaller investments.

For copper, there’s the added challenge of:

  • Bulkiness: Copper is a dense metal. Storing large quantities can be impractical due to the weight and space required. Investing in smaller, more manageable amounts may not be very cost-effective.
  • Limited Market for Reselling: Not all bullion dealers buy copper, and those that do may not offer competitive prices.

So if an investor wants to avoid the risks and volatility of mining stocks, what’s an investor to do?

Fortunately, there are commission-free ways of investing in bullion, with lots of liquidity.

The way to accomplish this is by buying precious metal Exchange Traded Funds.

The most popular one is the SPDR Gold Shares (GLD), which actually owns gold bars. The fund has $62.8 billion in assets and an expense ratio of 0.40%. It is up 12.3% year-to-date.

If you are looking for silver, there is the iShares Silver Trust (SLV). The trust has a net asset value of $12.9 billion and sports an expense ratio of 0.50%. The year-to-date return is almost double what GLD provided, generating 24.1%.

As for copper, there is no ETF that owns copper bullion directly. That bullion would take up a huge amount of space. However, there is the United States Copper Index Fund (CPER), which has an objective of tracking the price of copper using copper futures.

CPER is a very low cap ETF at $229 million, and carries a relatively high expense ratio of 1.o4%. The year-to-date return is 15.5%.

Most stock brokerage firms don’t charge a commission to invest in ETFs, making the precious metals ETFs a cost effective way to trade or invest in bullion.

So now you have a few options of getting into bullion with having to buy bars or coins directly.

Disclosure: Author has a long position in GLD.

Should You Shine On Silver? Examining the Benefits and Investment Options

Unveiling the Precious Metal’s Potential in Your Portfolio

Silver, the lustrous metal, has captivated investors for centuries. But beyond its beauty, silver offers a unique blend of potential benefits for your portfolio. Let’s explore why you might consider adding silver to your investment mix, and then delve into the various ways to hold this precious metal.

The Allure of Silver

  • Diversification: Silver’s price movements tend to have a low correlation to stocks and bonds. This means it can act as a hedge, potentially offsetting losses in other parts of your portfolio during economic downturns.
  • Inflation Hedge: Silver, like gold, has historically held its value well against inflation. As the cost of living rises, silver’s price may follow suit, protecting your purchasing power.
  • Industrial Demand: Silver’s industrial applications in solar panels, electronics, and medical devices create a constant demand stream, potentially influencing its price positively.
  • Potential for Growth: Silver’s supply is finite, while demand is expected to rise, particularly in developing economies. This imbalance could lead to price appreciation in the long run.
  • Affordable Entry Point: Compared to gold, silver offers a more accessible entry point for investors starting with precious metals.

Silver Investment Options: Weighing the Pros and Cons

  • PHYSICAL SILVER (Bullion & Coins):
    • Pros: Tangible ownership, no counterparty risk, potential for collector’s value (for certain coins).
    • Cons: Storage costs, insurance considerations, potential difficulty selling quickly.
  • SILVER MINING STOCKS:
    • Pros: Potential for higher returns due to leverage on the silver price, diversification within the precious metals sector.
    • Cons: Higher risk compared to physical silver, volatility associated with the company’s performance.
  • SILVER ETFs (Exchange Traded Funds):
    • Pros: Low storage costs, fractional shares allow for easier investment amounts, high liquidity.
    • Cons: You don’t own physical silver, expense ratios can eat into returns, counterparty risk associated with the ETF issuer.

      The most popular silver ETF is the iShares Silver Trust (SLV), which has an objective of tracking the price of silver.

A Word about Silver Coins and Authenticity

All three of the above items are FAKE!


Be careful about buying silver coins, as there are many fakes being distributed. These are not just the coins with numismatic value but also the so-called junk silver coins and even the bullion coins (silver rounds).

Fortunately, there are several ways of checking whether a coin is genuine or not. One simple way is to use a phone app called CoinTester. It measures the sound of the ping when the coin is hit with an object, like a pencil.

First, you choose the type of coin. (Note: If you are checking a silver dollar, for Keyword, just type Dollar, not Silver Dollar.) You place the coin on your fingertip, tap Check on the app, then hit the coin a few times with something that won’t damage the coin (I use the wooden part of a pencil.) If is shows a 0 or 1 out of 3, it means the coin is a fake. If it shows a 2 or a 3 out of three, the coin is real.

Just remember that all tests for coins aren’t foolproof. The best approach is to buy from a very reputable coin dealer.

Many numismatic coins are slabbed. In numismatics (the study or collection of coins), “slabbed” refers to the process of encapsulating a coin in a hard plastic holder, often called a slab. These slabs are usually sealed and graded by a professional coin grading service. The purpose of slabbing coins is to protect them from damage and to provide an objective assessment of their condition and authenticity.

When a coin is slabbed, it is typically accompanied by a label indicating its grade, which is determined based on factors such as wear, luster, strike quality, and any imperfections. This grading process helps collectors and investors assess the value of the coin and provides assurance about its authenticity and condition.

Slabbed coins are often considered more desirable for collectors and investors because they come with a trusted third-party evaluation, reducing the risk of buying counterfeit or over-graded coins.

The Final Shine

Silver offers a compelling option for investors seeking diversification, inflation protection, and potential growth. Carefully consider your investment goals and risk tolerance when choosing between physical silver, mining stocks, or ETFs. Remember, a well-rounded portfolio is key, and silver can be a bright addition to the mix.

Silver as a Hedge Against Inflation: Top Silver Stocks

by Fred Fuld III

Gold and silver have historically been considered a flight to safety, especially during times of high inflation and economic uncertainty. Silver has outpaced inflation during certain time frames.

One of the advantages of silver over gold is that the metal is less expensive, making it more affordable to smaller investors. In addition, silver has far more commercial and industrial uses than gold.

There are several ways to invest in silver. Here are the primary alternatives.

Silver Bullion

You can buy silver bars and rounds in various sizes and weights. They may be produced by the United States government or by private mints. They are easily identifiable and fairly convenient to purchase though coin shops or online gold and silver dealers. You obviously have to be concerned about storage safety do to the potential for theft.

Junk Silver

Junk silver refers to U.S. dimes, quarters, and half dollars minted in 1964 or early, which ere made with 90% silver. These coins have little to no numismatic value, making them a reasonable and simple way of accumulating silver at a reasonable price. Junk silver is available from numerous coin and bullion dealers.

Silver ETF

If you want to invest in silver directly without taking physical ownership, the best way is though a silver exchange traded fund, such as the iShares Silver Trust (SLV). This ETF can be bought and sold just like any stock, without having to worry about storage.

Silver Stocks

There are several companies that specialize in primarily mining for silver. Most of these are Canadian companies, and three of them pay dividends.

First Majestic Silver Corp. (AG), which trades on the NYSE, has a market capitalization  of $2.43 billion. The stock has a high trailing price to earnings ratio of 67.7 but a forward P/E ratio of 18.6. Earnings per share for next year are expected to be up 218.8%. The stock pays a small dividend of 0.21%.

Pan American Silver (PAAS) trades on NASDAQ. It has mines in mines in Canada, Mexico, Peru, Argentina, and Bolivia. This $5.24 billion market cap stock trades at 52.6 times trailing earnings and 18.8 times forward earnings. Estimated earnings per share for next year are expected to increase by 35.96%. The company pays a decent dividend yield of 1.97%.

Silvercorp Metals (SVM) is a smaller company, with a market cap of $524.5 million. The company’s mining properties are in China and Mexico. The company has several mines in Mexico, and interests in one mine in Canada. The stock has a very favorable trailing P/E ratio of 15.5, and an a better forward P/E of 10. Just this year, earnings per share jumped by 33%. The dividend for this stock is 1.97%.

Silver Mining ETFs

A diversified way to invest in silver mining companies is through an ETF. The most  popular are Global X Silver Miners ETF (SIL), ETFMG Prime Junior Silver Miners ETF (SILJ), and iShares MSCI Global Silver and Metals Miners ETF (SLVP).

Maybe one of these investments may give you a sterling portfolio.

 

Disclosure: Author didn’t own any of the above at the time the article was written.

How Did the Meme Stocks Do Last Year? Here’s How

by Fred Fuld III

About a week ago, I heard an analyst on CNBC being interviewed about meme stocks, although he didn’t pronounce it “meeem”, he pronounced it “me-me”. Do you think it was accidental, through ignorance, or on purpose with a hidden meaning?

Whatever you call them, the meme stocks have had a wild ride last year. Surprisingly, a few of them performed extremely well, but many ended up dropping over 40% for the year.

Interestingly, the top performers were GameStock, I mean GameStop (GME) (did I type it that way accidentally or on purpose?), up 688%, and AMC Entertainment (AMC), which rose by 1183%.

The memes that tanked the most were Clovis (CLOV) down 78% and ContextLogic Inc. (WISH), which dropped by 83%.

The following is a list of the meme stocks and semi-meme stocks along with the January 1 to December 31 performance for the year 2021.

GME 688%
AMC 1183%
CLOV -78%
CRON -43%
DASH 4%
FVRR -42%
HOOD -49%
IQ -74%
OTLY -61%
WE -27%
WISH -83%
BB 41%
SNDL 22%
BYND -48%
SLV -12%

Maybe we will see some meme action again this year. What do you think?

 

Disclosure: Author owns SLV and HOOD.

Top Silver Stocks: 10 Reasons Why Silver Should Go Up

by Fred Fuld III

Unless you haven’t watched TV or looked at the news on the Internet, you already know about the short squeezes taking place in such stocks as GameStop (GME), AMC (AMC), Nokia (NOK), and Bed Bath & Beyond (BBBY).

If you pay any attention to the stock tweets on Twitter (TWTR), you will notice that silver got caught up in all the hype, especially the iShares Silver Trust ETF (SLV) and the Sprott Physical Silver Trust (PSLV).

If you are looking at silver and silver mining stocks as a long term investment, it is not the short squeeze that you should take into consideration. There are actually ten reasons for investors to be bullish on silver.

  1. It is a major component of solar panels.
  2. It is a major component of electric cars.
  3. It is used in electrical components for all automobiles.
  4. Because gold has become relatively expensive, demand for silver in the jewelry industry is increasing.
  5. The U.S. Government is flooding the economy with money, making the dollar worth less and silver worth more.
  6. Governments around the world continue to mint numismatic silver coins.
  7. Silver is used in healthcare products.
  8. It is used in water purification.
  9. Interest rates are very low.
  10. Limited supply and strong demand.

If you are looking for a mining stock, here are a few to choose from.

Stock Symbol Country Market Cap P/E ratio
First Majestic Silver Corp. AG Canada 4.89B
Avino Silver & Gold Mines Ltd. ASM Canada 162.13M
Endeavour Silver Corp. EXK Canada 900.73M
Fortuna Silver Mines Inc. FSM Peru 1.68B 75
MAG Silver Corp. MAG Canada 1.90B
Pan American Silver Corp. PAAS Canada 7.36B 253
Silvercorp Metals Inc. SVM Canada 1.34B 35

One of the stocks, Pan American Silver, pays a dividend yield of 0.77%. The company increased its dividend yield by 40% last year.

Just keep in mind that the market for precious metals and mining stocks can be very volatile. Hopefully, you can strike it rich with a silver stock.

Disclosure: Author owns SLV, EXK, and AG.