Rare Coins – 3 Things You Should Know Before Investing

Collecting rare quarters and US gold coins is an excellent hobby and a way to invest your money. However, if you don’t know what you’re doing then you could end up losing money. Before you invest in rare coins, here are three things you should know.

Secure Your Financial Future

When you’re searching for rare US gold coins and rare quarters, you should always remember that they are an investment for the future. Although the rare coins will also be the most expensive, the likelihood is that the value will only continue to rise while you own the coin. Buying coins made from precious metal also means that they have value in themselves, irrespective of the rarity of the coin design. This means that every coin you buy is a financial investment, should you decide to sell your collection in the future.

This does mean, however, that you want to take extra care to ensure that every single coin you buy is genuine and has been kept in good condition. Before you start, invest in a detailed coin guide to study what different kinds of coins are worth. Learn all you can about the aesthetic value of coins, and which designs are rarer than others. Making sure you’re prepared in advance means you’ll make good investment decisions.

Exercise Caution

No matter where you buy your rare coins, always exercise caution. Be wary about your dealer. Check, independently, whether they’re a member of any professional coin organizations, and tread extra carefully if they’ve only been in business for a very short amount of time. You can ask them as many questions as you need to before making the deal, and even consider a second opinion if you aren’t sure about the value of a coin.

Where To Buy Coins

There are many different options when it comes to getting hold of rare US gold coins. You can try searching your local area for a dealer or any coin auctions. However, you’ll greatly expand your choice if you look to the internet to locate some of the best coin deals. Online auctions and coin dealers are good places to look, as long as they provide detailed photographs and are willing to answer all of your questions before you buy.

Current Silver Prices Offer a Great Opportunity

While current silver prices have not shown the explosive growth that gold has enjoyed, we firmly believe that it’s an excellent long-term investment.

Silver has many benefits for the precious metals investor. It’s not only valued in its raw form as bullion but is used in millions of products that we take for granted, like consumer electronics.

Here are the top reasons to invest in silver.

You Get More Exposure For Your Money

One ounce of gold is far more than $1,000 at the time of writing (actually, around $1600). Silver, by contrast, is a little under $30 per ounce.

For an investment in gold to increase by 15 percent, the price would have to rise by nearly $200 per ounce; the same return in silver would only require a rise of around $3.50 per ounce.

The downside risk is also greater. If the current silver prices fall, it doesn’t take as long to lose money either.

Governments Do Not Hold Silver

Almost no governments hold reserves of silver. This means they have to resort to buying their required silver on the open market, like everybody else.

It certainly does not hurt demand for a product if world powers need to buy it too.

Silver is Undervalued vs Gold

A snapshot of prices of silver and gold in the past century would show times when silver and gold were much closer together than today.

At one point, one ounce of gold was worth about 15 ounces of silver; current silver prices mean it takes about 48 ounces of silver to buy one ounce of gold.

As the high price of gold prices out some smaller investors, they will seek other places to put their money. Once sentiment swings back towards silver, it will correct to closer to the historical average.

Silver is Needed for Industry

While gold is also used sparingly in high-end consumer goods, the mass market requires a lot of silver for literally millions of components in products we use every day.

Whatever device you are reading this article on has lots of silver components. Your cell phone could not operate without it. Silver is an essential element in batteries, which power almost every device we use. The world covets gold, but it cannot do without silver.

Silver Wastage

Apart from bullion and jewelry, much of the silver we use is scrapped, ending up in a landfill. This, along with dwindling stockpiles of silver around the world, and lower mining output, has combined to create a perfect storm of strong, growing demand and lower supply.

Estimates predict that the supply of silver in the world may be exhausted in just 25 years. Now is a great time to put yourself in the position of holding onto a scarce commodity.

Silver is Currency

Silver coins have formed the basis of commerce for millennia. Far more than gold, it’s silver that has driven the expansion of person-to-person trade.

Easy to move around and universally acceptable, silver has actual value, unlike the paper money your government can print at will.

It’s Time to Invest in Silver

Current silver prices are extremely attractive. The upside potential is huge. As a buy-and-hold precious metals investment, it’s hard to beat for an investor who finds it hard to justify the current gold price.

Silver Investing is a Glittering Opportunity

Some ‘in the know’ investors may laugh if you suggest that silver is a great bet. They might counter by saying silver has dragged its heels for a long time.

While silver is considered a poor relation to gold, and gold is the stronger status symbol, silver has so many more uses – uses that are common, and growing.

Technology as we know it cannot function without silver. The growth of the middle classes in emerging markets, such as India, China, Russia, and Brazil means that the demand for electronic items is only going to increase.

More than 90 percent of silver is used in some form of manufacture:

  • Consumer goods/electronic items
  • Photography
  • Jewelry
  • Silverware
  • Coinage

Silver is Consumed

Did you know that we throw away the majority of the silver that’s produced each year? That’s right. There’s silver in landfills around the planet, as consumers dispose of millions of tons of unwanted items.

There’s no efficient or cost-effective way to recycle silver from post-consumer items. Supply has not met the demand for more than two decades, which has led to reserves of silver being bought up.

Remember: supply and demand determine value. High demand and low supply always force prices higher.

Fundamentals of Silver Investing

Buy and hold silver. You will automatically be reducing the amount of silver in the supply chain, and over the years your bullion can only increase in value.

Whenever a commodity is in demand and lacking supply, there is a fundamental shortage. People holding that in-demand commodity are virtually guaranteed to realize strong gains.

So, sell the farm and put it into silver? Of course not! Any sane investor always maintains a balanced approach, adding silver investing to their diversified portfolio.

Forms of Silver

Silver investing takes multiple forms.

You can invest in physical silver: bullion, or coins. Ignoring collectible coins, you are seeking to buy and hold coins purely on their silver content.

Because this is a specialist area, and there is still silver bullion available, it’s wise to stick to the simplest method: buying silver bullion, or pure silver coins from reputable, world-renowned mints.

One advantage of physical silver is the joy of ownership. You can touch and appreciate the investment you have made. Also, in times of crisis, those silver bars or coins will have spending value that either paper currency or paper silver will no longer have.

Paper silver is an alternative often used when it’s impractical to own large quantities of bullion.

It can be more convenient to trade paper silver if you’re an active investor, and if purchasing a large quantity, it prevents you from needing secure storage.

However, you should not put all your investment funds into paper silver. If things turn bad quickly, it will be hard to liquidate your paper silver, and you won’t have the advantage of physical silver “money” in hand.

Silver investing in stocks means buying an equivalent that follows the price of silver closely on the open market. Again, it’s not the same as owning physical silver, and silver stocks should certainly not be your only silver investment.