Content

• Steps
• Method 1 of 5: Preliminary Steps
• Method 2 of 5: Buying scrap silver
• Method 3 of 5: Buying Silver Coins or Bars
• Method 4 of 5: Buying Silver Without Real Owning
• Method 5 of 5: Getting the Benefit

Silver is a precious metal that has long been used as a currency and is widely used in industry. Like gold, it is bought in large quantities by investors who wish to trade it like a commodity or use it as a hedging instrument in times of economic uncertainty. If you want to trade silver, then you need to know where to start. Below are the essential basics.

Steps

Method 1 of 5: Preliminary Steps

1. 1 Consider what kind of silver you would like to buy. You can buy silver in the form of scrap and bullion, in the form of "paper" silver, which is a contract to buy real silver (without having to stock it), and in the form of silver futures, which is one of the ways to invest in the future forecast price of silver. ...
   • If you want to buy real silver, beware of baits and dishonest methods, when the seller instead of silver shows some documents that allegedly confirm the storage (warehousing) of real silver in other places.
2. 2 Find a reputable dealer. Find a reputable dealer to avoid fraud and other disadvantages when buying.
3. 3 Estimate the market value per ounce. In financial markets, there is the concept of a troy ounce, which gives the price of a precious metal per ounce. Check its current value to make sure the seller is not asking for a much higher price than the market prices for silver.
4. 4 Agree on the terms and conditions for the sale of silver. In any silver transaction, there are specific conditions that must be negotiated between the seller and the buyer. Without considering these conditions, you risk being damaged.
   • If you agree to buy paper silver, find out how the seller is going to secure the contract with real silver. For example, buyers reported that commercial banks are offering a silver (paper silver) contract and that there may be delays and obstacles in demanding real silver.
   • Discuss the numismatic and pure value of silver. Some vendors offer silver coins as real silver. In this type of transaction, it is important for the buyer to find out the numismatic value of silver in the form of coins, which can influence the decision to buy them. Without going into details, such a purchase can cost you too much.
   • Ask about the premium (additional fees). Some sellers, such as banks, charge additional fees for the sale of silver. Such pitfalls affect the final price of silver and confuse the buyer. Require your seller to quote the full (real) value of the trade so you can calculate your gains from future silver price increases.
   • Learn about buying back. Some sellers (by no means all) buy back the real silver that they sold to you. Keep in mind that without a repurchase agreement, you could suffer a loss on the sale of silver if you cannot find a buyer who offers fair value based on the original selling price and current market prices.
5. 5 Obtain Information for Tax Returns Another important step when buying silver or any other precious metal is to obtain the sales documents and the original value of the silver. This is so that you can declare the original value of the silver when it will be sold in the future in order to obtain a benefit (to report specific income from the sale of silver to the tax authorities).

Method 2 of 5: Buying scrap silver

1. 1 Learn to identify real silver. Genuine silver jewelry is labeled with a test number 800 or 925 or the word (derived from the word) "sterling" (for example, Ster, Sterling, Stg). If you can't find the fineness or mark on your silver, here are three quick tests you need to do to determine the authenticity of your silver.
   • Real silver is ringing... Either toss in a silver coin or bang another coin on it to make a sound. The sound you should hear in the case of real silver is a high-pitched ringing like the ringing of a bell.
   • Real silver melts ice... Place the ice cube on top of the silver and notice that the ice melts faster than just at room temperature. Silver melts ice faster because it has a very high thermal conductivity.
   • Real silver is not magnetic... Take the magnet. Tilt your silver bar 45 ° and let the magnet slide freely down the bar. On real silver, the magnet will slowly slide down. If you do not have silver in your hands, then the magnet will either linger in the upper part of the ingot, or slide down very quickly.
2. 2 Ask friends or family. Many people have broken or damaged silver jewelry and would be happy to sell it at a reasonable price. Some may even give them to you for free.
3. 3 Post ads. Use your local newspaper or internet resources to post a message that you are interested in buying scrap silver.
4. 4 Find reputable dealers. Ask your friends before agreeing to the first proposed deal (online reviews do not count). If the deal seems too good to be true, then it probably is. ...
5. 5 Find your own sources. Look at online auctions, flea markets, thrift stores. Online auctions tend to have higher prices, but the safest ones offer ways to verify the authenticity of silver. It's the same as finding a decent second-hand item for a minimal price.
   • In particular, look for thick rings, broken jewelry, and silverware.
6. 6 Meet the owners of pawnshops. While pawnshops are not likely to be the first on the list of places to find silver, getting to know their owners can provide a wealth of valuable information and possibly help make useful contacts. If you are lucky, through a pawnshop that does not generally scrap silver, you will get in touch with potential sellers.
7. 7 Look for silver in unexpected places. In addition to jewelry, silver can be found in circuit boards, old electronics, mobile phones, photographic plates, and old cameras. Look for non-working electronics in flea markets and warehouses of organizations and schools that have a tendency to update technology.
8. 8 Sort your silver. Remove any non-silver items and collect all silver items in airtight containers.
   • Note that some jewelry will cost more as a piece than when broken for scrap.

Method 3 of 5: Buying Silver Coins or Bars

1. 1 Consider investing in silver coins. Silver coins have their value both in silver content and in terms of numismatics. In most cases, the numismatic value of a coin is the primary factor in determining value. This means that the characteristics of the coin are its origin, condition, etc. - mean more to collectors than the actual value of silver (when talking about price).For this reason, many investors caution against investing in silver coins if you are not interested in numismatics at all.
   • Due to the collectible nature of silver coins, their prices can be very volatile. In fact, their prices can fluctuate dramatically due to market demand and often for reasons that have nothing to do with the price of silver. If you are going to invest in silver coins, then consider this before proceeding with the transaction.
2. 2 Try your hand at investing in silver bars. Silver bars are cast from almost pure silver and look just like they are shown in the movies. Due to their purity, they are often traded above the market average for silver. You can find silver bars at major banks or dealers.
   • Silver bars come in different shapes and weights: from 50 grams to 1 kilogram. What you need to know when choosing a weight is that the lighter the bar, the higher the premium. If you really want to save money on bank payments, buy lots of bars!
3. 3 Consider investing in silver in coins by weight. The weight of silver in coins is practically the same as that of silver bars. Investment coins are made from precious metals and are meant to be invested instead of being used in trading. Thus, you can buy silver coins by weight if you are not seduced by the idea of ​​buying silver bars.

Method 4 of 5: Buying Silver Without Real Owning

1. 1 Consider investing in an ETF. An Exchange Traded Fund, or ETF, is an institution that tracks indices or prices for commodities (such as silver) and its shares are traded on the exchange. Although ETFs are similar to index funds, there are often no fees when buying and selling ETFs.
   • It is important to remember that when deciding to invest in an ETF, you are not buying real silver or even the right to buy real silver. Typically, you are simply betting that the price of silver will rise.
   • If you are convinced that the price of silver will fall, or just want to hedge against a fall in price, you can short sell ETFs.
   • ETFs are also beneficial due to their high liquidity, which means they can be cashed out quickly.
2. 2 Also consider investing in a mining company on risky terms. If you want, you can invest in mining in addition to investing in real silver or ETFs. If you follow mining companies closely or are familiar with the industry in general, this might be an option. Consider the following caveats when investing in a mining company:
   • The mining company's share price could go down, although the price of silver is rising. Even if the value of silver rises, you can lose money on such investments; for example, if the mining company you have invested in has poor governance or weak quarterly reporting. Therefore, investing in mining companies is a risky business.
   • Big risk - big benefit. If you are willing to take big risks, then investing in mining can pay huge dividends.

Method 5 of 5: Getting the Benefit

1. 1 Be aware that owning real silver is probably more beneficial than owning a security in it. Real silver, such as coins or bullion, was and is used as currency and in industrial production. This makes it more versatile than securities, although not necessarily liquid. If you are planning to invest, be sure to start with precious metals before venturing into other, more complex forms of ownership.
2. 2 Use silver as a hedging instrument in the face of economic uncertainty. In times of economic uncertainty and slow growth, silver is an excellent hedging instrument. Hedging is a strategy that reduces the risk of losses from market fluctuations, usually by investing in offsetting positions. Investing in silver is a good defense against currency depreciation and even inflation. This is because with a rapid devaluation of a currency, the value of precious metals such as silver and gold remains relatively stable or even increases.
3. 3 Don't buy in hope and don't sell in fear. Many buyers of silver and gold have a completely wrong investment strategy: they buy when the price rises and sell when it falls. Don't violate the first principle of investing - buy low and sell high.
   • Try to think the other way around. Instead of buying when everyone else is hopeful and the price of silver is high, buy when everyone else is panicking (selling) and the price of silver is down or low.
   • Take a look at the historical silver price chart. Over the past 30 years, in a stable economic environment, the minimum price for silver has hovered around $ 5 an ounce. If you are willing to wait for the price of silver to fall to such a low level, then use that as a guide and then invest. When the economic situation is uncertain and the price of silver rises, sell your silver at a good profit or use it as a hedging tool against currency depreciation.
4. 4 Be aware that the silver market is highly volatile. If you are not ready to take a roller coaster ride when investing in silver, then perhaps silver is the wrong choice for your investment. Of course, if you are lucky enough to buy silver at the lowest price, then the greater volatility will play into your hands. But even then, be prepared for massive price swings due to changes in consumer sentiment and monetary policy.