When it comes to investing our money, we always look for the best way of making a profit. However, sometimes we find two different ways that look pretty much viable and do not know how to proceed. This is the case of investing in silver coins or bars. The best way to know which is the most proper investment is by understanding their pros and cons.
Silver bars are 99.9% pure, whereas pre–American Eagle coins were 90% pure silver. Coins, however, hold a face value that will maintain should the spot price of silver go below a dollar per ounce. Moreover, coins are more accessible to trade and transport than bars.
It is essential to learn about the advantages of disadvantages of the asset we want to invest in. In this way, we can be sure that we make the right decision when we incline towards one or the other. Suppose you would like to learn more about whether it is better to invest in silver coins or bars. In that case, we recommend you continue reading this article. Continue to make the best profit out of your investments!
Silver Coins vs Silver Bars
To know whether it is better to invest in silver coins or bars, we need to learn their pros and cons. Depending on the use you want to give to each of them, you can decide if putting your money into one or the other would have a better outcome. However, before we jump into advantages and disadvantages, let’s first have a description of each. In it, we will consider their shape, silver content and purity, design, and weight.
In the first place, we will deal with a description of silver coins. Although the first known coins date back to Roman times, like other region samples, these were silver drachms with supplementary bronze coinage. The silver denarius became their main currency later in time.
- Shape: You may think it odd to talk about shape when we deal with silver coins. Still, it is essential to know that, while generally circular, coins can also be minted in other forms, such as rectangular.
- Silver Content: Taking United States coins as an example, they historically contained 90% silver purity. However, this changed when the American Eagle bullion coin program came into practice in 1986. Since then, the U.S. Mint coins are 99.9% pure. This is something important to bear in mind when analysing a coin for its value.
- Design: Inscriptions on a coin vary depending on the nation it was struck in. They provide information such as face value and country, and date of mintage.
- Weight: Coins also vary in weight depending on their face value. A U.S. dime, for example, weighs 2.268 grams (0.08 oz), whereas a dollar coin weighs 8.1 grams (0.286 oz). Nevertheless, they may be found in other values that range from fractional to even a kilo when it comes to collector coins.
Pros of Silver Coins
Coins hold some advantages over bars. To make it as clear and straightforward as possible, we will enumerate the different factors in which investing in silver coins is better than buying silver bars.
- Face Value: Apart from their spot value, given by the market price of silver, coins hold a face value. This is what stores, banks, and other places take that coin for. When we buy or sell something, we use a coin that reads “one dollar”, for example, and that is the standard value we give to them. This is an advantage because, should the spot price of silver ever fall to a value below a dollar, a one-dollar coin would still be as valuable as the inscription on it reads. Take it as a “safety net”. However, this face value is not related to the spot value, which is higher.
- Liquidity: Coins are far more liquid than bars. Why? Because coins are easier to sell. They have a collector’s value, which is not the same in the case of all bars.
- Transportation: Imagine you find a buyer for a coin you have and want to sell. Whether that person is far from you or within walking distance, carrying a coin will always be easier than taking a full silver bar. This also brings us to the next advantage, fractionality.
- Fractionality: When we buy or sell silver, we do not always do it for the same weight. Going to the same example as before, where you find a suitable silver buyer, you cannot split it into pieces to sell a fraction if that person does not want to buy an entire silver bar. Thus, you lose your buyer. If, on the other hand, you possess a 25oz. tube of Australian Kangaroos, for instance, you can take one or two of them and sell them separately.
In the case of silver bars, some advantages position them as a better investment over coins. Before we go over them, let us briefly describe what silver bars are, following the same standards as we did with coins.
- Shape: Although this is not officially dictated, most bars are rectangular.
- Silver Content: Almost all genuine silver bars are 99.9% pure silver or higher.
- Design: Inscriptions on silver bars include a refinery logo and marks that provide information on weight and purity.
- Weight: Silver bars vary in weight. The most common weights for silver bars start in 28.3 grams (1oz.) and can go up to the next typical weight of a kilo (35.274 oz.)
Pros of Silver Bars
As it happens with silver coins, silver bars also hold some advantages when it comes to investing. We will also deal with them through a list so that they are clear and simpler to understand.
- Purity: As we mentioned before, coins before introducing the American Eagle bullion coin program in 1986 are less pure in silver than a silver bar.
- Storage: If you plan to buy considerable amounts of silver, doing so in bars can be of help. This is because their rectangular shape makes them easier to stack. In fact, that is the main reason why they are shaped that way! The absence of high-relief inscriptions is also an advantage when storing them.
- Capital Exploitation: With the same amount of money, given the purity of bars, you can acquire more silver by choosing them as an investment. The difference may be as slight as a couple of grams, however.
What Should I Invest in?
We can go on talking about the different benefits of silver coins or bars for eternity. Unfortunately, there is no sure answer to this question. What is essential is to know what we are investing in. Having a good insight into the advantages or disadvantages of the asset we are acquiring instead of others can help us decide which investment is adequate for us. If you have any doubts about silver coins or silver bars, do not hesitate to contact us. We will be glad to guide you on this or any other topic related to investments. You can also follow us on our social media to keep in touch with any relevant news. Remember to subscribe to our weekly newsletter to receive tips, news, and updates!