There are three ways to buy gold, silver, and other precious metals. Everyone in the industry has their opinions of which way is best, but I can say definitively that there’s only one correct answer.
Let’s get the one undebatable method out of the way. Buying gold and silver ETFs is not really buying gold or silver at all. Brokers can go through mental gymnastics to say buying exchange-traded funds based on gold and silver is actually like buying gold and silver, but it’s not. The metals aren’t yours. You’re just buying stocks in someone else’s metals.
With that established, let’s talk about the two types of physical precious metals you can buy. The vast majority of gold companies that you’ve heard of got to where they are because they focus on numismatics. These are the “rare” minted coins that hold a higher value than their weight demands. Of course, value is a perception… but I’ll get to that in a moment.
While there’s nothing inherently wrong with buying numismatics, the industry has become rife with companies that overcharge. And when I say overcharge, I’m not talking about companies making 30%-50% margins. I’m talking REALLY overcharging for these coins. They can get away with it because the price is determined by the seller, but the VALUE is determined when you actually have to liquidate.
Just because you pay $70 for a one ounce silver numismatic coin doesn’t mean you’ll be able to sell that coin for $70 later. People generally buy numismatic coins in the hopes that over time they will appreciate faster than rounds or bars. Sometimes, this is true, but it’s far from guaranteed.
The third way to buy gold and silver is my preferred way to sell it. Even though Advisor Metals has full access to sell whatever numismatic coins our clients want, we strongly recommend rounds and bars. Our reasoning is very simple. We want to get as much gold and silver into the hands of our clients as possible. It doesn’t matter if it’s a special edition super-minted extra-mega-wow numismatic with Mickey Mouse shooting skeet engraved on it or not. We sell straight bullion.
Whether someone is getting physical precious metals sent discreetly to their door in a cash purchase or if they want a self-directed IRA backed by bullion, we can help them. We deal honestly and transparently with our customers. We have a $2,500 minimum for cash purchases and a $10,000 minimum on rollovers and transfers.
Lastly, let’s talk about value, as promised. Some will rightly point out that the perceived value of numismatic coins can actually appreciate over time. This is true, and as I noted we can sell them at anyone’s request. I don’t want people to think I don’t recommend them because we don’t have access to them. We do. The reason we don’t recommend them is because in the current economy, we believe buying rounds and bars based on weight is the best strategy for both the short- and long-term.
If things continue to go south with ESG funds, de-dollarization, inflation, sustained recession, and the ongoing banking crisis, then there will come a time in the near future when nobody’s going to care about the Mickey Mouse Skeet coin. Its value will not appreciate any faster than the basic rounds or bars that I recommend. In that scenario, it’s better to buy two 1-ounce rounds than a single “special” 1-ounce numismatic for the same price.