New entrant to Silver, with questions.

mattyman174

mattyman174

Active Member
Hello.

My name is Matt.

Come the beginning of 2019 i will be starting to purchase Silver as a store of wealth for the future. Im an Australian, the current economic and social conditions in the country during the recent past has me worried on a number of levels, so i want to start preparing for my future.

Im 27, ive completely abandoned the idea of purchasing property, it is absolutely not feasible in the current climate and something tangible and real such as Silver is making more sense to me as time goes on.

Im a Software Engineer; Financials, investing, accounting, the stock market and all that crazy stuff most of the time goes over my head (oddly enough). Ive been doing a fair amount of research, watching videos, reading articles and im starting to get the idea. Initially i thought Gold might be a better option however ive come to the conclusion that its not the easiest to start in (I have a small family and my buying power isnt amazing at the moment) and Silvers potential and low price is much more appealing.

With all that said, i have questions.

Premiums...

Most of my price checking has been done on the www.abcbullion.com.au website, being new im not to keen on purchasing from a vendor that doesnt have a known reputation or i cant verify their authenticity very quickly. The premiums are higher and the range of products not available at the moment on www.perthmint.com make ABC Bullion a much better option (so i can tell), im assuming because Perth Mint is government owned.

My question mainly pertains to 2 x 1kg Cast Bars that are advertised.

1kg ABC Bullion Cast Bar
https://www.abcbullion.com.au/store/silver/sabc32151kg-abc-bullion-cast-bar

1kg PAMP Cast Bar
https://www.abcbullion.com.au/store/silver/spamp32151kg-pamp-cast-bar

Their advertised percentage of pure Silver being .9995 and .999 respectively.

Given the current spot price displayed on their site at the time of writing being $20.46/oz ($657.789/32.15oz) and their respective prices of $692.80 and $717.80, is the 1kg PAMP Bar premium really that high for less quality?

If i was to purchase both and then sell both at a later date, given their purity .9995 and .999 respectively why is the difference so high and what would i likely be getting for both bars? Is it really just the brand your paying for in the premium?

It would seem to me that the 1kg ABC Bar is by far more value than the 1kg PAMP Bar. Would my exiting price to a buyer be the same for both Bars or would the PAMP Bar attract a higher price over spot given its brand?

Or am i misunderstanding the purity levels here?

Thanks.
 
Like Oz says, stick with the lower premium bars such as Perth Mint, ABC etc

PAMP costs more mostly because of the brand, and being Swiss, where as there's plenty of high quality Australian stuff here that's cheaper

If you're more comfortable starting off buying from a dealer, then Perth Bullion (Based in WA) and Gold Stackers (Based in VIC) would be the Top 2 I would recommend. Usually have the best prices, and are great to deal with so check out their sites and see how you go

Once you've dipped your toes in and got more comfortable here, check out the AUS/NZ trading section of this forum, because members sell cheaper than bullion dealers so you'll usually get the best price right here on this forum. You can check each users trading history too, so if you see someone selling something you'd like, check their trading history and if they have a strong track record then you can feel very comfortable sending them money and having them post the goods to you
 
Hi Mat,

welcome to stacking. I'm in much the same position to you as I'm a similar age, I started staking about 6 months ago and for almost the exact same reason. I'm not an expert by any means and I can tell you the learning curve was steep.

As for your question, for me, yes you will be paying higher premiums for the branding. Many dealers and most buyers will hold P.A.M.P bars to a higher level of esteem when compared to ABC bullion or "generic" bullion. But your eventual exit strategy will depend on whether you're prepared to pay the higher premium.

If you plan on selling your silver privately then get the higher premium bars as "Joe Public" may be interested at any price, just look at what people on this forum pay for "collector" and "rare" historical bars. But to most dealers bullion is bullion, they will usually give you spot price at best but maybe even the melt/bid price.

One thing I have learned is keep clear of ebay, for some reason people pay exorbitant prices over spot. Also you will have to make the personal choice on whether postage counts. For me, as an investment, the total cost including postage will need to be overcome to gain a profit. Others regard postage as inevitable because you have got to pay it for everything, so for them postage doesn't count.

Another piece of advice is establish early whether your stack will be a pure investment or a collection of things you like. I don't go for numismatics much and don't see the value in paying heaps over the metal value because it looks shiny or has a cute picture on it. You may not get the numismatic premium back when selling to a dealer.

I found Backyard Bullion on YouTube to be extremely helpful and honest. As well as this forum is always friendly and informative

Hope this helps. I really enjoy stacking, its a wild ride, have fun.
 
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HI Matt,

Welcome, though dont give up on the idea of property purchase already, beside time is on your side as this is not the time to buy a property.
Mind me asking as a Software Engineer why such a gloom on your financial future, surely you are looking at six figure salary in not to distant future.

As for Silver or Gold unless you feel there is a massive economic crash in the next two years I would refrain from purchasing anything more than token physical metal, and look towards allocated or unallocated metal from Perth Mint or such.

https://www.perthmint.com/storage/depository-online.html
https://www.perthmint.com/storage/pricing.html


At 27 you have plenty of time to learn while accumulating and by going the paper route for small amounts it will save you a lot of money postage and or premium.

Later as your "stack" grows and your understanding of the metal market increases, you can start selling on the up days and buying it back on the low days to use the volatility to your advantage.

Note: By all mean buy some physical metal but imagine if you accumulated $20,000 or $50,000 of physical silver how long it will take to convert to cash, its nice to have few bars and coins at home (I do and collect few choice coin series) but at 27 seriously look at unallocated options.
 
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https://sgd.indigopreciousmetals.co...apore-pickup-or-freeport-client-vaulting.html

https://sgd.indigopreciousmetals.co...apore-pickup-or-freeport-client-vaulting.html

http://www.perthbullion.com/shop/detail/pmsbk1/

if you search wider, you can see dealers can sell very close in prices from one to the other here is $2 difference

all the explanation broke apart, there is nothing special for it to attract that kind of big premium

they are just silver bars, not the 5 nines of a kind 99999 or old poured collectible small bars that has collectors following
 
Thank you for the responses.

stackmans said:
One thing I have learned is keep clear of ebay, for some reason people pay exorbitant prices over spot. Also you will have to make the personal choice on whether postage counts. For me, as an investment, the total cost including postage will need to be overcome to gain a profit. Others regard postage as inevitable because you have got to pay it for everything, so for them postage doesn't count.
Click to expand...

I explored Ebay just to see what it was like, i already was highly skeptical that it would be overpriced and i wasnt wrong. I dare say i will never buy off Ebay.

I do usually regard postage as a necessary part of purchasing the physical asset (I live rural so i dont have much choice) however i will be keeping detailed logs of all my purchases and will be recording and factoring in the postage price. I will obviously be as efficient in postage where and when i can.

stackmans said:
Another piece of advice is establish early whether your stack will be a pure investment or a collection of things you like. I don't go for numismatics much and don't see the value in paying heaps over the metal value because it looks shiny or has a cute picture on it. You may not get the numismatic premium back when selling to a dealer.
Click to expand...

I plan on holding onto the assets for a very long time. Im not using this as an means to get rich quick, there are better options for that (stocks for example). This is purely a long term store of wealth for myself and my family.

I have little interest in purchasing assets for their rarity or history. Just looking for pure Silver.

Ipv6Ready said:
Welcome, though dont give up on the idea of property purchase already, beside time is on your side as this is not the time to buy a property.
Click to expand...

Yes i agree, that was more what i meant than outright refusing to buy property at all.

Ipv6Ready said:
Mind me asking as a Software Engineer why such a gloom on your financial future, surely you are looking at six figure salary in not to distant future.
Click to expand...

I live rural and as such work remotely. Im also a stay at home Dad and i usually work on average maybe 25hours per week, this gives me more time to focus on family, this was a personal choice. At these restricted working hours (without trying to sound like im blowing smoke up my own arse) i still make more than my partner however her previous life left her with some significant debt we are working off. I tend to lean heavily conservative when it comes to our financials.

If i worked 40+hrs per week and had no other commitments that id care to look after then yes i would be sitting very pretty, however we are on the road to financial safety and i prefer to look over the long term financially and socially.

Ipv6Ready said:
As for Silver or Gold unless you feel there is a massive economic crash in the next two years I would refrain from purchasing anything more than token physical metal, and look towards allocated or unallocated metal from Perth Mint or such.

At 27 you have plenty of time to learn while accumulating and by going the paper route for small amounts it will save you a lot of money postage and or premium.

Later as your "stack" grows and your understanding of the metal market increases, you can start selling on the up days and buying it back on the low days to use the volatility to your advantage.

Note: By all mean buy some physical metal but imagine if you accumulated $20,000 or $50,000 of physical silver how long it will take to convert to cash, its nice to have few bars and coins at home (I do and collect few choice coin series) but at 27 seriously look at unallocated options.
Click to expand...

Unfortunately today i find it quite naive to trust anyone significantly influenced with your financial future.

Philosophically i prefer "you hold it you own it". But thank you for your viewpoint none the less.
 
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G'day Mat,

I was in a similar position to you not that long ago re what's what in the metals market. Asking questions here is a great start and all the points raised by members here are valid.

For me, as a Sydney based person I opted for ABC as they had the best pricing, web portal for buying and customer service is 10/10, for a local in Sydney who could collect from their Sydney office.

I too asked asked the question re ABC cast and PAMP bars. If buying metals to hedge against future uncertainties ie inflation, currency crisis, SHTF, then shinny polished bars will only be worth their per oz weight like cast IMO. I went with ABC cast bars to kick off with then looked at coins and other AU & AG options to spread the investment. KJC in Sydney CBD also have some interesting items but if it's bars at the lowest price from a known name (in Sydney), then ABC is the go. If I was in Perth, then I'd be going Perth Mint as paying for postage for bars ain't cheap.

Welcome to the forum mate.
 
Try www.kjc-gold-silver-bullion.com.au

Whats your budget mate?
Are you looking at spending a large sum of money on silver?
What about Gold? Platinum ?

Try and buy on the dips ...Don't spend all your money on silver ,always have a bit of cash on hand to pay bills and the like ,last thing you want to do is spend all your money on silver ,be in a position where you have to sell it at a lower cost due to financial stress !
Personally i like rounds and 1 oz bars ...im more than happy to pay a premium to have smaller quantities like 1oz bars or rounds ...i always try to save up and look for a big dip then purchase a mini monster box of 200 oz for around $4770..

Cheers
 
Oddjob said:
For me, as a Sydney based person I opted for ABC as they had the best pricing, web portal for buying and customer service is 10/10, for a local in Sydney who could collect from their Sydney office.

I too asked asked the question re ABC cast and PAMP bars. If buying metals to hedge against future uncertainties ie inflation, currency crisis, SHTF, then shinny polished bars will only be worth their per oz weight like cast IMO. I went with ABC cast bars to kick off with then looked at coins and other AU & AG options to spread the investment. KJC in Sydney CBD also have some interesting items but if it's bars at the lowest price from a known name (in Sydney), then ABC is the go. If I was in Perth, then I'd be going Perth Mint as paying for postage for bars ain't cheap.
Click to expand...

I live relatively close to Sydney so i will certainly be checking out the options available there the next chance i get.

Your advice is appreciated.

Red Quoll said:
Try www.kjc-gold-silver-bullion.com.au

Whats your budget mate?
Are you looking at spending a large sum of money on silver?
What about Gold? Platinum ?

Try and buy on the dips ...Don't spend all your money on silver ,always have a bit of cash on hand to pay bills and the like ,last thing you want to do is spend all your money on silver ,be in a position where you have to sell it at a lower cost due to financial stress !
Personally i like rounds and 1 oz bars ...im more than happy to pay a premium to have smaller quantities like 1oz bars or rounds ...i always try to save up and look for a big dip then purchase a mini monster box of 200 oz for around $4770..

Cheers
Click to expand...

Thank you for the web address.

I will be starting off small. 1oz ABC Eureka Coins peaked my interest. Im wanting to find out estimated shipping times to my address, packaging style and overall size of coins to begin with before going to deep.

I wont be going to deep to fast, i will most likely be starting with 3x1oz Coins given the current going price on ABC and their $25 shipping fee rounding it out to $100. This i can manage every week and assuming the first batch goes well i will most likely continue this way and possibly making larger purchases of Cast Bars every so often.

I have not had the time to commit to exploring and researching options for Gold/Platinum, once im comfortable with the process of Silver purchasing and its expectations i will diversify at a later time.

Im certainly not putting all my money into this. As ive stated before, this is a long term project and im acutely aware of the need to hold fiat for immediate necessities.
 
I think KJC charge like $3.90 for a kg of silver delivery fully insured....
Try not to let postage bring your dollar cost average up($100 for 3 oz of silver factoring in shipping will cost you $33.333 an oz just to break even mate) $25 shipping is pretty steep for 3 oz of silver !
If you go to Sydney ,id just pop into one of the stores and buy up ....save....go to Sydney....buy ....save..go to Sydney...... buy ....ect
Silver is a funny metal... its either explosive and makes great gains..... or it just sits there going side ways in price...and just frustrates you !
Its a love /hate affair with silver
 
from over a decade's experience buying PMs - if it is silver, starting out and from a low base, take a good look around and sit on your hands. Get to know the varieties of silver and how you intend to store it.
I would consider the general types - 5kg bar, 1kg bar, fractional ingots, minted 999 coins and medals, round fifties (0.8 silver) and predecimal pre46 (ie .925 silver).

The benchmark aimed at is a low buy and sell spread, ie after you buy, you could sell it close to buy point. That is very important for a *bullion* stacker.

The reference point for this is the 1kg generic Aussie bar, eg ABC cast bar.

Once you have surveyed the landscape, look at past buy and sell spreads, because this fluctuates quite a bit over time. When silver is popular, you will see that many of the above items carry a steep premium, for example junk silver coins. Not so much now, so if you can get them at spot, there is a chance you can leverage a sale later off a higher spread than you bought at, meaning more for you or if you want a quick sale closer to spot, you are more likely to achieve it.

Smaller items are easier to buy regularly too.

1kg bars are not a bad way by any means and there is always a good supply from reputable dealers. Perth mint coins sometimes can be had at almost spot - several years ago this was the case with the Sydney Funnel Web. If you aren't scared of spiders, it was to my thinking a better choice than generic 1kg bars as they look better and are smaller denomination, meaning that you can buy and sell in smaller amounts as you wish or probably get a load off quicker than the 1kg bars if you wanted to sell.

You will see fairly often a good deal or two here, with smaller items at or around spot, including circulated or uncirculated coins, minted medal sets. Again, sit back and nut it out for yourself. There is usually no need to jump straight in unless it is clearly a great deal. Keep your powder dry.

Be warned about reading information on the internet about silver. At one time, there was a lot of hogwash about attacks on the Comex, "the manipulation", backwardation, no inventory, peak silver and all manner of panic merchants flapping about impending collapse to make you buy all the things, or closer to the top, billionaires with their own cotery of "experts" doing a circle jerk of quoting each other on informercial style news. It was always the same, the sky is falling but the price is going to the moon. It was all garbage in the end. And they're still doing it!

The ETFs were derided for years here and on most well known silver bug sites. This is in hindsight a better way, provided you are holding for over a year in Oz (to minimise CGT) and your entry point is say 10kg or more, to offset the cost of the buy and sell transactions.

ETFs have a major advantage in that you can buy and sell from home and they avoid the inevitable problem of accumulation of silver - its mass and weight. If you are thinking of moving to the city later, you could have to lug it wherever you go. Not really a problem with 10kg, 20kg but what about 50kg? What about 100kg or more? Even 10kg is a mild hassle flying. You will at some point look at storage fees for a locker. For a simple tray in a major vault that could set you back 400+. Then there is insurance. These are considerations versus a safe, burial or some other form of securing it.

ETFs skirt all that. In the end, you are trying to make money *period*. If the issue is small amounts of saving regularly, as it is now, then buying physical forces a discipline. It is also pleasant to hold silver but even that gets old.

Numismatics are another choice. The major valuation books typically at the dealers have wildly inflated prices, much more than often the coins are sold for by dealers and grossly out of line with the buyback. You will also need to learn a little about grading. At the same time, some appreciate very nicely and make nice heirlooms. With silver, many graded collectable coins are not that dear.

Agree with ebay, avoid. Also gumtree seems to have some insane people on it who think they are going to rake in the tonnes for what are poorly graded or even more dodgy coins. There are plenty of Chinese fakes out there. Caveat emptor.
 
mattyman174 said:
I wont be going to deep to fast, i will most likely be starting with 3x1oz Coins given the current going price on ABC and their $25 shipping fee rounding it out to $100. This i can manage every week and assuming the first batch goes well i will most likely continue this way and possibly making larger purchases of Cast Bars every so often.
Click to expand...

Most Dealers will hold your order until you have a larger amount to post if you ask them. So if you are planing on making weekly orders you might consider letting them build up till you have a decent amount and save on postage...
If you are ordering 3 rounds a week and paying 25 for postage. at the moment you're essentially missing out on a shiny ounce every week. :P
 
mattyman174 said:
I wont be going to deep to fast, i will most likely be starting with 3x1oz Coins given the current going price on ABC and their $25 shipping fee rounding it out to $100. This i can manage every week and assuming the first batch goes well i will most likely continue this way and possibly making larger purchases of Cast Bars every so often.
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Hi Matt, welcome to the forum. I buy from bullion dealers sometimes too and like you say I always factor in postage or transport to collect the items. The cost to post 3 1 oz silver coins should not be more than $7 registered. Paying $25 for 3 coins in postage is too much, you would be robbing yourself of bullion. Sometimes things get a bit light on the forum here, by that I mean not many are selling and good deals are scarce. That's when I might place an order with a bullion dealer.

Rather than buying 3 coins a week, save up 1 or 2 Months worth and buy a tube from a member here or a bullion shop. I catch a train in specifically to pick up bullion in person from bullion dealers in the CBD. If you do a turn around in less than an hour the return trip is treated as a transfer and you only pay for a one way trip (about $6). Postage can make or break a deal for me. Some people on ebay charge $8.50 for 1 lousy coin in postage. Funny because I can do it for $2.20 standard or $5.50 registered.

My opinion is to wait for deal here in Australia/New Zealand trading section and as one other poster said buy from sellers with 100% positive trader feedback. The more feedback and more recent feedback is better. Do not trust those with negative feedback.

I am looking at buying 1 kilo bars soon too. 1 Kilo Perth Mint bars are all sold out at Perth Bullion + I would have to pay postage too. ABC Bullion on the other hand have the 1 kilo cast bar in stock right now for $692, They were $670 last week. Hoping for prices to come back down a bit and might buy some. Cheers and good luck with your journey.:)
 
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Thanks for all the advice.

As a newcomer and with no idea of who to trust or what websites to trust, i fell the postage price at ABC Bullion worth the risk for the moment. I understand its steep, i will certainly be looking around for better bargains. But as a first purchase im happy to go that route.

Thanks once again.
 
mattyman174 said:
Thanks for all the advice.

As a newcomer and with no idea of who to trust or what websites to trust, i fell the postage price at ABC Bullion worth the risk for the moment. I understand its steep, i will certainly be looking around for better bargains. But as a first purchase im happy to go that route.

Thanks once again.
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which part of the country are you in, if I may ask. I know quite a bit of it.
 
I'm also a newbie (7 months into pm) I might not be able to provide the correct advice. But through trial and error, and having spent quite a bit sum, I think I now know a little about physical pm.

1. PM should be only part of your portfolio, e.g. 10-30%. Personally, I'm 10% AG and 10% AU currently.
2. Try splitting between AU and AG, e.g. 50:50.
3. Get some low premium semi-numis from big mints with smaller mintages (<30k). This is more for fun but may turn out profitable.
 
ABC can store bullion I think. They have allocated and unallocated so you might want to contact them about it. You can register with them to have an account, by scanning some ID and emailing it to them. Doesn't take long to set up. A phone call or two and you are up and running. You don't even have to buy anything, just sit and get a feel for the ropes until you are more confident. You might want to weigh up whether it is is worth the postage versus those options when you set the account up on the phone. Driving into the CBD and finding a park around there are factors. I think fees were very heavy in the nearest multistorey carpark.

Depending on where you are in regional NSW and travel costs/inconvenience, Sydney is a safe option for kilo bars from a dealer but a WTB ad here might lead to an exchange with someone in your area or close to it (agree to start with a vendor with a good reputation here, just get them to PM you about your locale). I have previously done a number of times that way when out in the country there. You may negotiate price to a degree if it seems on the high side - it is a market.

Look at the buyback from the major dealers. That is your reference point to determine a fair deal, particularly with 1kg bars. Remember dealers have to factor in overheads such as wages, equipment, advertising, realestate, utilities, insurance, taxes into their sale as a business, so they sell the bars a bit higher than they buy them for. However, private sellers often don't have this problem, so a fair deal in a private sale is about what the buyback is for a major urban business, imo.
 
get some pictures in a private trade first btw. I've had the odd sale of a bar that is a little beaten up. From a big dealer, that never happened.
 
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