Those looking to get into silver bars will quickly learn of two company names: Englehard and Johnson Matthey.  Many investors will ask only for one of these two types of bars.  Fortunately, Bullion Trading LLC carries both.  These bars are one hundred ounces .999 fine silver (99.9% pure).  Unlike coins, which have an everyday usage as well as a specific appeal to collectors, bars exist entirely for the sake of storage.  Investors may store a great amount of physical wealth in a relatively small space. 100 ounces silver bars are easy to stack and store.  Their dimensions are approximately 6.5 inches long x 2.5 inches wide x 1.25 inches in depth.  They weigh only 6.86 pounds on bathroom scales, making them relative portable and easy to handle. Furthermore, 100 ounce silver bars are accepted trading units, making them as easy to sell as they are to buy.  In other words, they’re very liquid!

            Silver bars of this or larger sizes do offer an important investment advantage: they carry a low premium over spot silver compared to Silver Eagles, Silver Maple Leafs or 1-oz silver rounds.  A bar is simply precious metal, designed to be traded.  It is not fancy nor carries nationalistic implications.  During the inflationary crisis and oil crunch of the 1970s, interest in silver bullion as a form of wealth protection grew in popularity. As a result of the demand, the Engelhard company began minting silver bars with weights of 1, 10 and 100 troy ounces. However, by the mid 1980s investor interest in precious metals had waned to the point that Engelhard decided to cease extruding silver bars.  JM bars are also discontinued.

            Despite this very brief history, both Engelhard and JM silver bars remain the industry standard in silver bars (or, to put it another way, the gold standard for silver!).  They are sought after for their guaranteed purity, quality and brand name recognition.  The Engelhard and JM names remain trusted and recognized icons in the precious metals industry and their silver bars remain in high demand.  Finding either of them can be a bit difficult due to the lack of production since the 1980’s, but fortunately that’s where bullion dealers come in handy.

            Someone new to investing in precious metals is likely to be attracted to the colorful designs of coins over the “dull” look of bars.  Yet what better place to start than with bars from a trusted brand and a proven record of value!

We’ve already discussed all that goes into selling gold and silver, but now you have to decide whether or not to use the benefit of the Internet. While the Internet’s reputation for providing honest business has proven to be less than favorable, one cannot deny how convenient it is.

Ideally, the best place to sell your gold to would be the same dealer that you purchased it from. He will be a reliable buyer since he should have the records of the exact purchases you made, and as a returning customer, he should give you a good deal.  But it is still an inconvenience to bring your gold over to him or to any other local dealer for that matter, only to be offered a price that may not be the one you want. The Internet on the other hand is a wonderful way around this; it allows you to search for multiple buyers from the convenience of your home. And trust me, finding people won’t be a problem. The moment you say “I have gold to offer,” you will definitely start getting attention. The issue isn’t if you’ll find people but how to make the right choice. This world comes with its own rules.

Within this article, we’ll just assume for the sake of argument that there are no scammers and that all prospects you meet will all be in good faith. This assumption is far from the truth, but it doesn’t matter. There are many more things to consider when selling gold or silver online.

An online gold dealer will need to see the item before offering you a quote and every single item requires inspection. Unfortunately, sometimes my clients may give me misleading information about their item, not out of malice, but simply because there are things they don’t realize. For example, if he is selling me a Pamp bar I will immediately ask if it’s enclosed with a certificate or if that certificate has been opened. He may answer yes not fully knowing what I am talking about, and it won’t be until I inspect the item that I realize he was wrong. Many customers don’t realize that once its certificate is opened, it is no longer valid and the bar will immediately lose some of its value. So for reasons like this, any respectable gold dealer will ask to see your items to properly assess their value.

This means you will need to ship it to them, and these shipping fees will be an investment on your part. Once the prospective buyer receives the item, you are entirely at his mercy. If he decides to buy from you, it will be at his discretion and on his own time, possibly leaving you in the dark. And if he should decide to decline the offer and ship the item back, it will be at your expense. Of course, you can try to avoid this by only looking for buyers in your local area, some of whom could even visit you in person, but that might backfire as well. Not every buyer may be comfortable with that arrangement, and you will be severely limiting your search, particularly when the Internet offers you a potentially worldwide market. And besides, do you really want to tell a random stranger “I’m keeping four kilos of gold in my house and, by the way, here’s the address?”

The other option is to sell your gold using some sort of auction. Now in our EBay article we discussed the drama involved with buying and/or selling gold that way. To sum it up: you will be stuck having to accept whatever the winning bid amount is, which may not necessarily represent that value of the item at that given time. You do not want to be in a position where your auction will be ending in one minute and your options are either to go through with selling your item for an extremely low amount or to just bail out of the auction, which will hurt your credibility in the Ebay community. And even if you do make a decent sum, keep in mind that between listing fees, transfer fees, and shipping, you may not make as much profit as you hoped for.  Then again, the opposite is always true as well. You may end up making a killing on your sale, despite the value of the item drastically plummeting at that minute. Some people will prefer to sell this way simply because they enjoy the suspense of this gamble.

So what to do? Personally, I always prefer to sell in person and know that doing anything online will only lead to complications. I would recommend selling only to someone you already know, trust, and have a relationship with, but if you must sell online, both online dealers and online auctions have their pros and cons. You could potentially make a great sale through either option. The drawback is that neither of the two really provides much security. So before you go into it, tell yourself that the issue isn’t finding a buyer but about choosing the right one, because the profit you make from this sale will be the sum total of the choices you make.

So just why is silver so different than gold?

In our “Why You Should Buy” article we discussed the key differences between the two metals, but there are so many questions specific to silver that it may well be its own market.  It seems that whenever the price of gold drops, silver goes with it, falling at almost the same trajectory.  Similarly, when the price of gold fluctuates around the same price, silver fluctuates as well and basically holds steady.  However, when gold goes up, silver may or may not follow.  Why is silver apparently so linked to gold on the downside but not always when it is the up?

The answer is that there is no actual physical link between the two.  Silver is more volatile because it has industrial value purposes.  When the economy goes down, so does the use of silver while gold obviously goes up because of its investment value.  However, when the economy is good, silver gets its share of usage, but doesn’t necessarily boom.  If your interest is in silver, whether it be American Silver Eagles or bullion quantities, just know that, like gold, it has its own rules and facts to be wary of.

Silver is often considered a training ground for the newcomers to precious metals.  It’s cheaper, can have better returns, and has everyday value.  Silver bullion also comes in a form that is not seen with gold: Rounds.  Silver Rounds are simply one ounce, .999% pure silver coins.  They are made by various private refineries and are cheaper than mint coins.  In some states, you can avoid sales tax if you spend more than $1,000.  Each Round has varying pictures because these companies have varying production runs using different designs.  Regardless of the picture on their front and back, all silver rounds state clearly on their face, “1oz. Silver, 99.9% pure (or .999 fine).”  Best of all, they are easy to buy, sell and count.  In the event of that fabled economic apocalypse we all hear about, having a may of Silver Rounds will be a lot more useful than a vault full of gold kilo bars.

Silver’s main drawback is its extreme volatility, making it a harder forecast to predict.  Silver was also affected in this past weekend’s economic tidal wave, dropping 17.71% in a single day, only to later go up 15%, also in a single day!  Yes, gold also goes up and down, but silver’s increases and declines are far more sharp!

Speak to your preferred bullion dealer about which of the two metals might be best for you to start with.  Some investors are very satisfied with silver and never feel the need to ever touch gold.  Fortunately, both of these metals are going through a historic time and continue to cast their enduring allure.

So now we enter the world of gold coins.

Once again, as with all forms of bullion, gold will always be a good investment.  American Eagle coins have always been “extremely liquid” investments and Krugerrands also remain one of the most popular gold coins globally. It also helps that all government-produced gold coins come in standard weights, such as one-ounce, half-ounce, or quarter-ounce, making it simple to determine the gold prices.  Finally, gold coins may seem to have a major advantage over kilo bars or other forms of bullion: the abundance of coin shops in local areas. This, however, is not necessarily an advantage at all.

This past weekend, the price of gold took a major nosedive.  Looking on the websites of several local coin shops, I was not surprised to see many of them began to remove certain gold items from their listings. Some items that previously been among the most expensive were no longer on sale. This shows the unreliable nature of a small business that deals with a volatile market. Let’s say that the coin shop has spent $1,900 for an item that he can now only sell for $1,500. He simply cannot afford to sell as he will not be able to recoup that loss. And so he has no choice but to take the item off sale until the situation changes. We discussed in our articles on Ebay and Selling Gold Online the unfortunate situation of starting an auction that goes badly and having two options: either to sell you item for far less than you paid for it, or cancel the auction, which makes you look irresponsible.  This is the exact same situation the owner of the coin shop is in.         As far as selling goes, you may potentially be able to sell to them for a high amount.  The disadvantage is that, again, being a small business, they will most likely only buy from you depending on what their inventory should be at that very moment or how likely they feel they are to make a sale with your item.  Each coin shop is like an isolated market with its own set of prices and policies.  The biggest deterrence to doing business with a coin shop is this lack of stability; you always want the person you do business with to be someone you can build a relationship with and will communicate with you regularly.  A small store with an unreliable inventory that may close shop on any given bad market day presents a challenge to this.

An advantage that Bullion Trading has is that our business is a long-term market and can hedge our losses even if the price should drop to $1,100.  It helps that we have many clients and items are sometimes purchased, sold, and repurchased within minutes; having so many sales allows our losses to be counter-balanced by new transactions.  In contrast to the isolated nature of the coin shops, a bullion dealer is part of a communal network.  Finally, despite what may seem like the natural assumption that coins would be best purchased at a coin shop, the truth is that any quality bullion dealer will be well-versed in coinage.

If you wish to get a consultation on certain gold coins, a coin shop will be a good place to look at many and learn all you can.  But just remember: no one wants to do business with someone who might suddenly need to bail out with the item in question or worse yet, someone for whom this becomes a very real possibility every other minute.