Thursday, May 21, 2009

Silver

Silver is a precious metal with the chemical symbol of AG from the Latin word Argentum.

Silver is a bright silvery colored (naturally) hard metal used in a variety of ways including industry, photography, cutlery and art as well as investment and jewelry.
Due to its excellent electrical conducting properties, silver is used in industry extensively for printed circuit boards and contacts. You will also find it used on the back of high quality mirrors as well as being applied in chemical reactions to produce other chemicals in which silver plays a part. Of course virtually everyone knows that silver is used in photography as well.

Unlike gold, silver does tarnish in the presence of certain chemicals, namely oxygen, ozone, hydrogen sulfide and air which contains sulfur. But it is easily cleaned and the tarnish rubbed off with a suitable cleaner.

Silver is even used in the health industry, such as dental and colloidal silver for its anti-bacterial for example. Hippocrates noted that silver had healing properties when correctly used.

So silver is a good all round precious metal with many uses

Of more interest to us is the investment side of silver. Because it is used in industry and other areas silver gets 'used up' and not replaced. Coupled with the small amount of silver mined means that silver is actually in short supply and this makes it an excellent investment vehicle.

Silver comes in either pure silver, such as in silver bullion bars of silver coins and rounds, or as sterling silver where the amount of silver is 92.5 and the balance is usually copper to give the silver more durability. Junk silver coins, early American dollars, dimes and quarters for example and even early British sixpences, contain a quantity of silver anywhere from around 45 percent up to ninety percent.
All these are valid forms of silver investment with the only question be, how much do you pay for them. Obviously one goes for the cheapest or the silver with the smallest premium. This would be silver rounds, junk silver and the larger silver bullion bars. Other forms have a higher premium, i.e. you pay more for the silver per ounce.

Silver, ounce for ounce, is cheaper than gold at the moment. So you can buy more for the same money. The disadvantage is that for the same amount of money you have to ship and store more silver by weight.

One of the best ways of accumulating silver which obviates these problems is using an escrow service. Here you open an account with a company that will sell you the silver at a nominal premium and store it for you. The storage is insured and you do not have the shipping and security issues.

Another advantage is that you are not restricted in the quantity of silver you buy, whether small or large, you can buy any amount and, if and when the time comes, just as easily sell it again. In fact one can take delivery of gold bullion in ones account in the form of pure 1000 gram gold bullion bars delivered to most of the western world.

The same applies to gold of course and one can have a balance of assets in both gold and silver this way.

But whatever your preference, buying silver is an excellent way to store some of your assets and preserve their value.

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