Ever thought of adding precious metals into your portfolio? Silver bars may be on your radar if you have been following the market or are looking for tangible assets to hold. Silver bars are more than just a shiny piece of paper; they’re a form of stable wealth, which many investors use to diversify their portfolios.
Before you buy, you need to know what you are buying. Silver bar investments can range from stacking simple bars to collecting rare vintage ones.
This guide will explain everything about silver bars – from their calculation to which brands command premiums.
The Basics: Why Buy Silver Bars?
Silver coins such as the American Silver Eagle or Canadian Maple Leaf are often what people picture when they think of it. Silver bars are more efficient than coins.
Silver bars are typically cheaper than coins. You get more silver per dollar. These coins are easy to store and stack, particularly in large quantities. This makes them popular with serious investors looking to increase their holdings of metals, without having to pay extra for government mint marks.
Understanding the Value of a Silver Bar
Beginners often ask, “Why is this bar 10 ounces more expensive than another bar of similar size?” It’s a fair question. Silver is still silver.
It’s not exactly. Although the price is similar, there are several other factors that influence it.
1.Spot Price and Weight
The Spot Price is what determines the value of silver bars. The current price of one troy-ounce silver. The price fluctuates continuously while the markets are open. This is due to global supply, economic factors, and industrial demand.
The multiplier is weight. There are standard silver bars in sizes such as 1 oz., 5 oz., 10 oz., 1 kg (32.15oz) and 100 oz. The larger the bar is, the less you will pay for each ounce.
2. Brand Reputation
The name of the bar is important, just like when buying a bag or watch. Silver bars from famous brands that have a long history of purity and quality are often easier to sell and hold more value than generic ones. These brands will be discussed in more detail shortly.
3. Condition and rarity
Investors will still value a bar that has been scratched. For collectors however, the condition of the bar is paramount. In pristine condition, vintage bars from closed refineries can fetch significantly more money than the melt value.
Types of Silver Bars: Cast vs. Minted
You’ll see two different looks when you begin to buy silver bars. Knowing the differences can help you choose which is best for your needs.
Cast Bars
The bars are cast by pouring silver molten directly into the mold. These bars have an old-world, rustic charm. They are not identical; there may be cooling lines, ripples and uneven edges.
- Best suited for: Investors looking to lower their premiums, and collectors with a rugged aesthetic.
Minted Bars
Just like with coins, they begin as silver strips that are then cut into blanks. These bars are often adorned with intricate security features, sharp detail, mirror finishes and mirror-like surfaces.
- For those who value perfection, intricate artwork and security features.
Famous Silver Brands That You Must Know
Sticking with reputable mints when buying silver bars is the smart move. This ensures the purity of your silver and will make it easier for you to sell later on, since these mints are known worldwide.
Engelhard
The name Engelhard has become synonymous with vintage silver. The company has stopped making retail silver bars since the 1980s but their bar is legendary. They are rare because they’re no longer produced. Engelhard bars are often highly sought after by collectors, particularly the “loaf style” older versions.
Johnson Matthey
Johnson Matthey has been around since 1817. They have an enormous following, just like Engelhard. They are known for their exceptional purity and classical design. They have stopped producing retail silver bars, but the JM logo is still a symbol of quality.
Sunshine Minting
Sunshine Minting is the place to go if you are looking for modern security. They are an industry leader as they supply the U.S. Mint. Silver bars from this company feature the unique security “MintMark SI”, which allows for verification of authenticity with a decoder. Investors who are concerned about counterfeits will find them a great choice.
Are You a Collector or an Investor?
The way you approach silver bars investment depends on what your ultimate goal is. Do you want to build a collection or protect your wealth?
The Investor Strategy
You want the best value for your money if you are only interested in a financial goal, such as hedging against inflation and betting on rising silver prices.
- Standard bullion or low-premium cast bar.
- Purchase larger sizes (100 oz and 10 oz), to lower the price per ounce.
- Do not buy: Limited editions, collectible vintage or fancy limited-edition bars that are more expensive because of their “cool factor”, rather than for the actual metal.
The Collector Strategy
Silver bars are “numismatic”. If you love the art and history of precious metals then you will enjoy them. Silver is not just silver. It’s history.
- Highlight: Vintage Engelhard and Johnson Matthey bars, or limited edition art bars
- Purchase: Bars that have interesting serial numbers or production errors.
- Accept Although you will have to pay more, the bar’s value is not tied exclusively to the silver spot price.
Final Thoughts
Silver bars are a great way to get into the precious metals industry. There is a bar for everyone, whether you prefer the rustic look of the poured one or the sleek appearance of the minted.
Focusing on premium brands, and knowing the basics of how they work will help you build an impressive stack. It can also serve as a financial base.