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« Precious Metals Stocks: The Next Quarter | Main | Silver Wheaton Corporation Options Trade Closed with a 60% Profit »
Thursday
Aug202009

The Purchase of Silver: A Readers View

silver fern coins.JPG


In this mornings mail bag we have an email from a reader in BC, Canada, the wettest place I have ever been to, but we wont hold that against him, who relates his own experiences regarding the purchase of silver. We would also like to take this opportunity to thank all those who take the time to add their comments as it is readers comments that makes hosting this web site worthwhile, without your input we would be operating in a vacuum.



Dear Bob,
 
Fistly I just want to state how enjoyable it has been following your newsletter over the past several months.  I have been interested in and have been investing in silver via several different methods over the years since 1972 and I have to admit that I am indeed a Silver Bull. 
 
I also follow David Morgan and other people who specialize in this area.  In the past 1 1/2 years I have purchased silver coins through Ebay but have found the premiums to be quite high. 
 
I have purchased through Kitco and find this to be an excellent site and the people tremendous to deal with. 
 
I have also recently purchased silver rounds direct from First Majestic Silver in Vancouver and have found the service to be excellent and the delivery very fast. 
 
I have more recently purchased silver rounds direct from the Northwest Territorial Mint in Auburn, Wa. and actually have found this to be the most economical way to purchase silver bullion as the premiums are very low.  For example, on July 8 when spot silver was $12.87, I paid a total of $14.22 US which included the shipping to Canada for 100 oz.   The service was excellent and very professional and communications were second to none.

Also worth noting on behalf of Canadian investors wanting to purchase .999 Silver coins, bars, etc. from the NWT Mint is that there is no duty or taxes payable which makes it even more attractive for us up here.

 
Just recently I discovered another excellent way (I feel) to invest in silver bullion without having to take delivery.  A new fund was launched by the same people who run Central Fund of Canada   (CEF) www.centralfund.com which has been around forever.  Their new fund invests in Silver Bullion and started  (July 29th) on the TSX (Toronto Stock Exchange) under the symbol SBT.UN.  There are also warrants of this fund trading as well under the symbol SBT.WT.  Check out their website at     www.silverbulliontrust.com for details.
 
I would very much like to get your feedback on this new silver trust and thought that this may be good information to pass onto those people who as I are interested in different ways to get into the silver market.
 
Regards,
 
Ron



If you have a comment for Ron, then please feel free to add it to the article via the comments box.

Have a sparkling day.

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Footnote:

Once during my college years I was sitting in the examination room with the examination paper placed face down on the desk when the clock struck nine am and we were off. It was a very tense moment until the student behind me said very quietly

psst, which we ignored
psssssssst, which we ignored again
pssssssssssssst, can you help me please – how many 'oos' are there in vacuum?

You know what its like when you cant laugh, the tears just rolled down my cheeks!

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Reader Comments (7)

I live in Toronto. I also purchased SBT in July. I TRUST them completely. I sold my shares in SLV, which I did not trust and bought SBT instead. The Warrants were a bonus that I was not fully aware of at the time of purchase. The Warrants allow you to purchase additional shares in SBT at the IPO price ($10 US) for up to 9 months from the date-of-issue (late July 09).

August 21, 2009 | Unregistered CommenterDaniel

Thanks Ron, for the invaluable information. I'd be interested in how you store silver. Not where but how...Del

August 21, 2009 | Unregistered CommenterDel Funk

Like Ron,I began acquiring silver bullion on the advice of David Morgan'Letter.First Border Gold and then First Majestic.Now Central Fund of Canada,SBT.UN.I like small bars for storage purposes,so Ron's advice of the US source for bars above is most welcome.Thanks for your well timed information comment Ron.
Ted,AB,Canada

August 21, 2009 | Unregistered Commentertedoliver.cal@shaw.ca

Hi Ron / Bob,
I am a BC Canadian trying to purchase some physical gold and silver coins/ bullions as a hedge against the monetary inflation happening now in the world. I admit i am a gold/silver bull for the last 15 years . Like Ron , i am a frequent visitor to Kitco, 321gold and read Jason Hommel and other PM letter to gain more knowledge.

There are not a lot of coin shops in local Vancouver area apart from J&M plus a couple more that can sell / trade precious metals. Their price is not the most attractive of course. I have been buying from J&M all this time paying extra premiums.

I too hold a small amount of funds in CEF 6 years ago in self direct RRSP and as a Canadian , holds stocks of a fair numbers of our smaller gold/silver mines. Throughout the last 20 years , i find myself being burnt by scandals originating from our late CDX exchange and later by BREX and later by the central bank selling bullions to keep gold price down so they can print more money.

With the immense size and population in the USA , it was a breeze to buy bullions there. Canadians can never get the bargain US citizens have . When the US dollar is low , our currency is even lower like what happened last Fall or even years ago when our dollar was just worth 61 cents US in 2001. If the Canadian currency is stronger due to crude oil and gold prices going up , we end up paying even more for the gasoline and gold coins even though our dollar gets a boost as well from it.When gold hits $710 last Fall , our exchange rate was around 0.72 effectively causing us more in Candian dollars to buy one ounce of gold.

By the way , Jason Hommel's Rockline shop sells physical silver bullions at sometimes , a dollar or less on top of the daily COMEX price.

Thanks to Ron for his generousity for offering knowledge of getting some bullions South of the border and the recent CEF Silver fund to the rest of us.

Regards,
kevin

August 21, 2009 | Unregistered Commenterkevin

WELL RON YOUR MISSING OUT ON A GREAT PLACE TO BUY SILVER AND RIGHT IN B.C. ( SURREY) TRY BORDER GOLD i think you will be satisfied

August 21, 2009 | Unregistered Commenterjames moss

I would like to thank Daniel, Del, Ted, Kevin and James for the feedback. Its refreshing to hear from persons with the same interests. Daniel, happy to hear that you are satisfied with SBT as I too purchased a few shares and warrants. I too trust them completely and feel that this fund will do extremely well in the near future. It is not uncommon for these types of funds to trade at a premium to their net asset value and we will likely see this as the demand increases. To answer Dels question about storage of silver, I am looking at a much more secure method than what I have at this time. I at one time used a safety deposit box but that can be expensive and as we all know, silver takes up a lot more space than does gold so more difficult to store. I'm thinking that a safe maybe one way to go. To Kevin, thanks for the kind words. I think its important in these times to share this information with others. I believe we are in for some very difficult times. James, thank you for the advice on Border Gold in Surrey, BC. I checked out their website and they are definately very competitive with the NWT Mint in Auburn on like items. NWT Mint does appear to have more selection though. I particularly like the Pan American and the NWT Mints silver rounds as they have less of a premium than the Silver Maple Leaf and the American Eagle. I believe I will give them a try on their 10 oz. silver bars. Thanks once again for this other great option. Look forward to hearing from other Silver Bulls and what their experiences have been and if they have any other suggestions or advice on the purchase of silver products. In the meantime lets all hope that silver goes to the moon and soon. Ron

August 24, 2009 | Unregistered CommenterRon

Buying silver bullion is also a great investment because it stays quite stable in times of inflation.

Silver is always a pretty reliable investment to make which adds to the attraction of buying silver bullion coins or bars.

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