In 2005, when silver spot price was below US$10, few took notice of this metal. And I was one of those who rather put my money in stocks than silver. In 2006, silver cleared the US$10 mark to reach US$15, I still was deeply immersed in stocks. It was only in 2007, when the US$ has been weakening and news of US housing bubble, that got me sitting up to look at alternative investment opportunities. In November 2007, I bought my first ounce of silver – the Canadian Maple Leaf when spot price was US$14.73 (S$27.65 at that time, inclusive of shipping, insurance and tax).
Naturally, the beautiful shiny silver round enticed me to look at other types of silver pieces available. I bought Pan-Am silver bars when spot was US$18.48 (S$28 at that time). My first high-premium silver piece was the 2007 Silver Britannia, which I paid S$56 for it. I also bought the Australian Lunar Series I Box Set at S$457 (S$38 per ounce) and a few other one and two ounce of the Lunar Series.
So what’s my point here about intrinsic and numismatic value?
When I got started writing this on 28 August 2010, silver spot price was still below US$20. At present moment, 11 October 2010, silver spot price is above US$23.23, monex is selling Canadian Silver Maple Leaf at US$25.37 (S$39.49 inclusive of shipping, insurance and tax). Let’s do some simple mathematics. Spot price has gone up 57.7% (US$14.73 – US$23.23) from the time I first made my purchase. Bullion price of the Canadian Silver Maple Leaf has gone up 42.8% (S$27.65 – S$39.49). Though I do not have the data to show that in Singapore Dollar terms, the gain is not a much, but let’s look at coins that I regard to have numismatic value – the Australian Lunar Series.
The Australian Lunar Series that I bought at S$457 is sells at S$846 without the box (85% gain). For key date coins, like the dragon, a 1 oz coin would cost S$90 (136% gain). A 2005 Britannia bought in June 2008 for S$47 was sold for £51 on 2 September 2010 - before silver price rally. The Chinese Silver Panda is another story of its own.
Hence, I would say, for silver investors, the preferred type of silver would be those that has low premium over spot price:
- American Eagle
- Austrian Philharmoniker
- Canadian Maple Leaf
- Mexican Libertad (except for 1998, 1999)
- Australian Kangaroo, Koala and Kookaburra
- Chinese Panda
- New Zealand Kiwi
- UK Britannia
- Australian and Chinese Lunar Series
- Somalian Elephants