When buying precious metals like gold and silver, people tend to look for sellers that can guarantee the originality of the metal. While there are physical stores present at every corner of the street that claim to sell the purest silver, you can not just enter a store and make such huge investments. In this situation, banks may serve as an ideal place to buy precious metals.
When talking specifically about silver as an investment, you may wonder if banks sell silver or not. If they do, is it the right decision to buy silver from banks instead of buying it from other physical or online stores? In this article, we have answered all your questions regarding buying silver from banks. Also, you will know whethersilver is a good investmentfor you or not.
Do Banks Sell Silver?
Yes, banks sell silver coins and silver bars. They claim 100% purity of silver and other precious metals that they sell. In addition, they provide you a certificate of ownership of the silver bar or coin that you are buying. This is the reason why new investors believe in buying silver from banks rather than physical stores.
Should You Buy Silver from Banks?
While buying silver from banks may give you the satisfaction of owning pure silver with a stamp and certificate claiming its purity, it is not a great decision to buy silver from banks. Here are some solid reasons why.
Over-Priced
When buying silver from banks, you have to pay a price that is significantly higher than the normal market price of silver. For example, if you are buying silver for Rs. 54,000 from the market, you may need to pay around Rs. 70,000 for the same amount of silver while buying from a bank.
Lack of Trained Staff
The banks selling silver do not have trained staff to check the purity of the silver. They sell silver coins and bars with the certificate as it is without checking the purity themselves. This may create chances of buyers buying fake silver coins.
Inability to Sell to Banks
It may be surprising for you to know that you can only buy silver from the banks. But if you go to sell the silver back to the banks, they will not accept it.
Less Selling Price
As mentioned above, the selling price of silver in the banks is higher than that of the market. So you buy silver at a higher price. Then if you wish to sell your silver assets, you have to sell them to the physical stores. So, you buy at a higher price and sell it at the market price which is lower than your buying price.
Inability to Sell to Jewelers
While selling the silver coins or bars to the physical stores or other jewelers, some of them may not accept it. This is because some jewelry stores have the rule to take back only the items that they previously sold.
How to Buy Silver?
Other than the traditional ways of buying silver in the form of coins and bars that needed a lot of care and additional space for storage, there are numerous other ways of buying silver as an investment asset. Some of them are:
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Silver Futures
Silver Futuresare a way of owning silver in a digital way. Though the investors can easily convert their e-silver into physical silver and get it at their doorsteps. The investors have to put up a small amount of money to hold a high value of silver. However, the silver futures are more suitable for experienced traders.
Silver ETFs
Silver ETFs are just like any other exchange-traded funds that have silver metal as the asset backing them. Most of the silver ETFs have the governments as their issuing authorities. So, the investors don’t have to worry about the credibility of the store that they are buying it from. Also, since the investors don’t have to get their silver ETFs physically, there are no chances of thefts.
Silver Stocks
Owning stocks of a company that mines silver is a great way of owning silver as an investment asset. Silver stocks are sure to benefit you as an investor. It is because if the prices of silver increase, the earnings of the silver mining company will also increase and hence the value of your stocks.
Digital Silver
Digital silver has emerged as a new and improved way of investing in silver digitally. While other methods of buying silver digitally can be a bit more time-consuming, you can buy digital silver in just a few minutes. There are numerous mobile applications like PayTM,OroPocket, PhonePay, Google Pay where the users can buy digital silver in a few clicks.
Is Silver a Good Investment Option?
Silver is a great investment option because of several reasons. Investors strongly recommend adding silver to your investment portfolio because of the reasons given below.
Store of Value
Silver acts as a good store of value. Its value, instead of depreciating in the long run, increases. This gives long-term investors a way to generate passive income from their silver-based assets.
High Returns
History has it that silver has often outperformed other investments assets in its value over a period of time. There are several instances where theprices of silver have increasedmuch more than the prices of gold or other asset classes like stocks.
Not Correlated with other Investments
Silver has its own separate class as an investment option and behaves opposite to the other assets in times of inflation, interest rates, geographical tensions, economic crisis, and so on. While other asset classes may go down the graph of prices against such factors, silver goes up in the same conditions.
Diversification of Portfolio
Silver as a precious metal is an excellent way of diversifying an investor’s portfolio and hedging it against turbulent market times. In case your investment portfolio is facing downturns, adding silver to it can balance the negatives.
Conclusion
If you are thinking of investing money in silver, it is definitely the right time to do that. However, you should refrain from buying silver from banks because of the reasons given above. If you are thinking of buying silver solely for investment purposes, the best way is to buy aSilver Auto-invest Planwhere you can buy a predefined amount of silver at the decided frequency.
