subject: How To Buy Silver: What To Look For [print this page] Silver! You want to buy silver?
First, consider the type of silver you would like to buy. It could be physical silver (scrap silver and bullion), paper silver (right to physical silver without the bothers of storage) or silver futures (investing in items that you think will give equivalent worth of silver in future). Immediate physical silver purchasing comes with baits; a dealer may offer you paper silver claiming that physical silver is held up elsewhere. Fall not into such traps.
Now that you have decided on the kind of silver to buy, move on to evaluate the market value of an ounce. Get the troy ounce, an indicator of the price of silver per raw ounce, and check out the current market price of silver. Know the price and cushion yourself from overcharge.
Silver selling and buying follows negotiation of certain terms. Are you planning to accept paper silver? Before you do that, find out how the silver seller holds physical silver that will satisfy your paper-backed metal. There have been horrible cases of banks and vendors offering papers with claims of physical silver backing only to frustrate buyers with unwarranted obstacles and delays when they ask for physical silver. This is the time to discuss the raw and numismatics values of the silver. For instance, if an agency offers to offer silver coins for physical silver, you ought to understand the effect of the coin or numismatic value on your purchases. Failure to understand this vital concept may result in overpayment for your silver holdings.
Terms also cover the premium fees. Some agencies, like banks, charge other fees to sell silver to you. The silver buyer is put underwater on their purchase immediately they sign for it. Make yourself clear: ask for a fair transaction worth of the silver so that you can notice any gains if silver prices increase. Do not buy silver before asking for your buybacks. Sellers may or may not accept buyback deals. Without buyback, you may incur huge losses when you want to sell silver especially if you find a buyer who is not fair to your original price of sale and to the realities of the market.
The next thing to know is how to document both the sale and the cost of your silver. Cost-basis information is necessary for tax filing as well as for the sale of the silver in future. Without this documentation, trouble may be brewed by the federal IRS when you pass the silver to another buyer.
To buy silver, especially scrap silver, you have to know the distinctions between real and fake silver. Authentic silverware or silver jewelry is normally stamped with a number 800, 925 or a clear commitment that the metal is sterling (ex. Ster, Stg or Sterling). Scrap silver can be obtained from friends and family at reasonable prices. They could be in possession of damaged or broken silverware or jewelry that serve them no more.
Silver may also be found in the unlikeliest of places. Look for silver from mobile phones, circuit boards, worn out cameras, used-up electronics, and photographic plates. Scrap yards, school or office equipment upgrading, and thrift shop electronics are likely sources of silver.
Buy silver from local pawnshop owners or ask these people for information. Place adverts in a local newspaper or radio station to alert potential sellers of your buying intention. Shop around before grasping any deal. Deals that look too good may be shams; dig them out. Before buying any silverware, remove all the non-silver components, collect silver pieces in a container with a seal.
Caution is vital!
by: Dennis Chernik
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