Is it worth investing in silver. Should you invest in silver? Securities of companies engaged in the extraction of precious metals

26.09.2019

In situations of economic uncertainty, there is always a sharp increase in interest in investing in traditional “eternal” instruments: precious metals and stones. Their reserves on Earth are finite, therefore, unlike other assets, the price cannot fall critically low. At the same time, any investment instruments can experience periods of extreme volatility, rush demand and panic sell-off. Today we will talk about why silver is attractive as an asset, what factors play in favor of the growth or fall of its value, and also try to draw conclusions about the prospects for investing in silver in 2016-2017.

Takeoff run before takeoff

If you look at the charts for gold and silver futures, you will notice the unusual similarity of their shapes. Percentage price changes differ many times, but the periods of rise and fall are almost synchronous.

But there is also a big difference in the nature of the demand for these metals. If the industrial use of gold is approximately 10% of the total volume of its consumption, and 90% of the mined gold is in the form of ingots, coins and jewelry, then the share of silver in industry is close to 50%, and excluding the production of silverware. This is one of the reasons that the 2011-12 high price period gave way to a deep and prolonged decline.

Most of the industrial use of silver is in electronics and solar panels, and amid a severe slowdown in the Chinese economy, there has been a redistribution of demand for silver: according to a 2016 Thomson Reuters newsletter for The Silver Institute, for the production of bullion and bullion coins in In 2015, 292 million ounces of silver were spent, which is a historic record. At the same time, industrial use was 588 Moz, i.e. only 2 times more (in previous years, the share of investment silver decreased to 1%). This demand ratio is unprecedented and can be interpreted as the first signals of an impending silver investment boom. Obviously, there are reasons pushing the price of silver up, even as its industrial use is declining.

First of all, investors tried to take into account the experience of the 2008-2009 crisis. Then everything happened too suddenly and against the background of the total, traditional safe-haven currencies seemed to be a good and reliable option. However, the current situation is fundamentally different from the state of the world economy before the collapse of mortgage funds. Graham Summers, CEO of Phoenix Capital Research, a consulting firm, keeps stressing that the world is on the verge of an unprecedented financial crisis that could bury currencies as they are. The largest banks in Europe and the United States have on their balance sheets 25-35 times their net worth, while the US stock market is at historic highs, and trading volumes have been declining for the third year in a row.

In these conditions, there is only one salvation from the coming ideal storm: precious metals, and the growth prospects of silver are significantly higher than that of gold (see). First of all, the effect of a low base affects: at the end of 2015, silver was oversold, besides, there is still a reserve for the growth of the investment component in the structure of its consumption. The ratio of the prices of gold and silver can fluctuate widely, but it still has its own statistical patterns. For example, it is extremely rare that it is equal to 80 or higher.

Usually, a very high ratio value clearly indicates that silver is undervalued relative to gold, or it can be interpreted as a strong oversold silver. But look at what we have now:

The ratio of gold and silver prices is close to all-time highs. Almost from the very beginning of 2016, both gold and silver have been in a phase of active growth, fueled by dying hopes of investors that the US Federal Reserve will raise its policy rate this year. But if gold is growing, then just think about the prospects for silver!

Methods for investing in silver

I have been running this blog for over 6 years. All this time, I regularly publish reports on the results of my investments. Now the public investment portfolio is over 1,000,000 rubles.

Especially for the readers, I developed the Lazy Investor Course, in which I showed you step by step how to put your personal finances in order and effectively invest your savings in dozens of assets. I recommend that every reader go through at least the first week of training (it's free).

Now let's talk about what investment in silver is. If we list all the possible options, then the list will look like this:

Silver bullion;
Collectible silver coins;
Jewelry;
Metal bank account;
(Exchange Traded Fund) investing in silver;
Buying silver futures;
Silver mining stocks.

In Russia, Sberbank sells the bulk of investment silver bullion. The procedure for buying silver itself is extremely simple: it is enough to have a passport and the required amount of money with you. Ingots differ in weight (from 50 to 1000 g) and packaging (standard or high quality). However, the problem lies in the fact that this type of investment in silver can be justified only in exceptional cases: when expecting at least a twofold increase in currency quotations of the metal, or when there is a threat of a sharp devaluation of the ruble. The fact is that the price at which Sberbank buys ingots is more than 1.5 times lower than the selling price, which includes VAT and. For example, as of July 1, 2016, a 50-gram silver bar in a standard package was offered for 2817 rubles, while the bank bought out such bars only for 1770 rubles. So - an occupation for those who are ready to wait for years.

With silver coins, the situation is even less attractive to investors. For example, the Sberbank website has an Excel catalog of available investment and collectible coins. It contains the denomination, silver content and price. Usually, investment coins are considered to be of high, but not exclusive, minting quality, called uncirculated, i.e. not in circulation. For example, investment coins with a face value of 3 rubles and a silver content of 15.55 are offered at a price of 1990 rubles. The bank accepts the same coins for 600 rubles, and even then, subject to the ideal condition. Collectible coins have an even higher minting quality, called proof, as well as a very limited edition. Their prices are much higher. For example, some collectible coins with a denomination of 1 ruble and a silver content of 7.78 g have a selling price of 9,990 rubles, and are redeemed by the bank for the same 600 rubles. Perhaps, after a while they can be rented out at a much higher price, but so far the practical value of such investments is extremely doubtful.

Silver jewelry is also generally of no value to investors, since its value includes not only the price of the silver itself, but also the artistic value of the item, the work of making it. Polish silverware is traditionally cheap: Poland is one of the world leaders in silver mining, and retail markups are small. Unfortunately, the system of standards and labeling of Polish silver jewelry does not stand up to scrutiny: often it is either absent at all, or does not meet the standards adopted in Russia. Therefore, if sold, such silver will have to be subjected to expensive laboratory research.

An interesting investment instrument is the so-called impersonal metal account (OMS) opened with a bank. The client buys virtual metal at the price offered by the bank, which is several percent higher than the exchange price on the same day. At the same time, he does not actually acquire metal, and the amount deposited into the account is converted into grams of metal. Later, in the event of an increase in the price of metal, the client receives income: if he closes the account, the bank recalculates the mass of the metal on the account into the monetary equivalent, but at the new price. In Russia, this option is much more attractive than buying bullion for several reasons:

When opening an OMC, the client does not pay VAT, as in the case of purchasing physical metal;
The spread in the case of OMS is a few percent and is significantly lower than in the case of bullion;
The price of the metal on the OMS is as close as possible to the exchange price, which allows (in the case of opening the OMS on demand) to sell the metal at a convenient moment with a profit;
Bank interest is charged on urgent compulsory medical insurance (usually very small).

This investment method also has its drawbacks. For example, when you receive income from the sale of metal at a higher price than when you open an account, you must pay income tax. In addition, the price at which the bank buys metal from the metal account will be lower than the selling price. And still, this type of investment is much more profitable than buying silver bullion.

An analogue of OMC in terms of profitability is the acquisition of shares of ETF funds (which means "exchange-traded fund"). Interesting for the investor is that almost 98% of the value of the shares of such a fund depends on the asset in which the fund invests. In other words, the purchase of shares of such a fund in terms of profitability is close to the purchase of the asset itself. In terms of structure, the fund is ETF, but its shares are quoted throughout the day, while in mutual funds they are determined by the value of assets at the end of the trading session. An example of an ETF is the iShares Silver Trust (managed by BlackRock with $ 4.6 trillion in assets). The chart of its quotes practically coincides with the quotes of silver. The undoubted disadvantage for Russian investors is that the shares of this fund are quoted only on the New York Stock Exchange. It is better to invest in such funds through reliable American brokers, for example.

Another tool is silver futures trading. In general, futures are divided into delivery and settlement. Deliverable futures assume the delivery of an asset on the date the contract expires at the price specified in the specification. Settlement futures do not imply the supply of an asset, but serve as a speculative instrument: between the parties to the contract, settlements are made based on the difference between the actual price on the date of contract execution and the price specified in the specification.

Settlement futures allow you to use leverage, which significantly increases the profitability of transactions. There is also a spot for silver: the average London fix price (the average price of delivery contracts made by five market makers). The London fixing for silver takes place at 12-00 GMT. Many forex brokers work with spot silver, for example. Trading conditions - from 0.01 lots, leverage - from 25 to 500. In terms of profitability (as well as risk), spot for silver is the undoubted leader.

Finally, we can consider this type of investment that depends on the value of silver, albeit very indirectly, as the shares of companies that mine silver. Among the countries, the leader in this area is Mexico, where more than 200 large mines are concentrated. And among Mexican silver mining companies, Fresnillo PLC is in first place (as well as in the world). Unfortunately, it is very difficult to assess the growth potential of this company's shares, since they are already rushing to storm historical highs:

As you can see, no correlations with the quotes of silver itself are observed in both cases, and the shares of these companies are not quoted in the RTS system.

findings

If we summarize the facts we have considered, then we can draw brief conclusions:

Silver has a pronounced investment attractiveness with great growth potential;
Among the possible options for investing in silver, the leader in terms of profitability (if there is a high leverage) is buying a spot from a forex broker. This option is also the most risky;
Approximately equal returns are achieved when buying silver futures, stocks of commodity funds and opening anonymized metal accounts;
The potential risk for investors is linked to silver.

Despite the fact that in terms of risks, silver is a less reliable asset than gold, the potential return is significantly higher based on the amount invested. Now, undoubtedly, it is worth taking a closer look at silver as one of the promising instruments for the formation of a portfolio. Perhaps such tools will soon appear in my portfolio. Keep an eye on.

Profit to everyone!

Precious metals - protection of finance from inflation and a chance to make money by increasing their value. Investing in silver is mistakenly considered less profitable than gold or platinum, although the potential for investments in this metal is higher. In today's article, we will understand the reasons for this and whether it is worth investing money in silver.

Why Silver Doesn't Rise in Price

The image below shows a weekly chart for silver in recent years. It can be seen that within 5-7 years the cost of the metal fell 3.49 times. Moreover, this fall looks illogical.

The following facts speak in favor of the growth in the cost of metal:

its supply on the planet is finite. Moreover, if the number of silver deposits exceeds the reserves of gold by 15-16 times, then in the industry there is only 4 times more silver, the sale of this precious metal is less than gold;
mining is difficult. Of the total amount of mined silver, only one fifth comes from mines, other mined silver is a by-product of the mining of nickel and zinc;
on the markets the supply of precious metals is limited. Nevertheless, its cost at the time of preparation of the material is 80 times less than the cost of gold, so the investment attractiveness is low;
it is in demand from jewelers, industry (used in medicine, instrument making);
silver does not return to the market. If gold from out-of-order or outdated equipment is mined, this process is economically unprofitable with silver. The same is with scrap, silver jewelry is less often melted and handed over as scrap. The resumption of supply volumes due to this does not occur.

Following the logic, the "Silver Age" should have already begun, but this is not happening, and the growth of the precious metal is postponed annually. This is due to the following reasons:

after the crisis and the decline in industrial production, the current level of silver production covers 100% of the needs of China, the United States and other industrial centers. It comes to the point that the metal is not in demand and is stored in warehouses, waiting for the buyer;
the price of silver is determined by the London fixing. There is an opinion that the cost of a precious metal is artificially lowered;
there are also prejudices about this metal. It so happened that a person prefers gold, although there were periods in history when silver was valued higher.

There are forecasts of experts, which promise a quick rise in the cost of this precious metal. They say that in the future, the cost of silver and gold may even equalize as reserves in explored deposits are depleted.

In the future, the demand for this metal will increase, so that an increase in the value of silver is inevitable. The only question is when it will happen.

How has the cost of precious metals changed in the past

Mankind realized the value of this metal even before our era. We will not dive so deeply into the pricing of silver, we will limit ourselves to a brief overview of the main events of the past. This will help to understand in what range the value of the precious metal changes.

In Britain (the key financial center of Europe in the 10th century), the national currency was initially tied to silver. The transition to a gold peg began during a period of explosive industrial growth in Britain. Silver became inconvenient, since the calculations required huge amounts of it due to its cheapness compared to gold.

Key events:

XXVII-XXVIII centuries - transition to a peg to gold. Silver was on the sidelines of the financial system, the transition to gold took 100-150 years. At that time, a fixed rate of this metal to gold was established at the level of 15-16 to 1;
until the twentieth century, there is a gradual decline in the value of silver, the ratio with gold increased to 44 to 1 and did not stop at this mark;
during the Second World War, the demand for precious metals exceeded supply, which led to an increase in its value. This metal was used for the manufacture of radio stations, encryption machines. There was no explosive growth, but silver added in value;
in the late 70s. of the last century, precious metals soared in price by more than 7 times. The reason for this is the purchase of about 30% of the world's reserves of this metal by the Hunt brothers (it was not the physical metal that was bought out, but its Mexican deposits). This coincided with the beginning of the scientific and technological revolution and the development of high-tech production, an increasing amount of silver was required. In the chart below, gold set a record price during this period;

in the period from 2009 to 2011 silver rose in value as it began to act as a safe haven that would save money during the global economic crisis. From the beginning of 2010 to the spring of 2011, the cost of the precious metal increased from $ 14.56 per troy ounce to $ 49.75. But the market turned out to be overheated, and the growth of silver ended there, since April 2011 the price of the metal has been decreasing.

A paradoxical situation has developed:

on the one hand, experts studying this issue say that the deposits of this precious metal on the planet will be depleted in 20-30 years. As a result, silver should rise in value even with the global industrial downturn and difficulties with economic growth, but this is not happening;
on the other hand, investment in this metal is still not very widespread, people do not notice the possibility of earning money. There is an equilibrium between the supply and demand of this metal. Conspiracy theories aside, this is the main reason for the lack of growth in silver.

But do not forget - its reserves on the planet are finite, mankind cannot do without it. This means that the current drop in value should be regarded as temporary, there are no fundamental reasons for it. While silver is at historic lows, this is a great investment opportunity.

How to invest in this metal, what an investor should count on

There are prospects for such investments, capital can be increased several times. Below we will analyze what kind of profit an investor can get and how to invest in silver.

Investments in bank bullion

This metal is sold in bullion by banks and certified dealers. Geometric characteristics and chemical composition of measured silver ingots are regulated by GOST R 51784-2001, this document has been in effect since 2002.

The marking looks like СШСр 10 or СЛСр 100, here:

C - ingot;
W or L - stamped or cast;
Ср - letters denote metal;
the number after the letters is the weight of the bar in grams.

The sample of silver, year of issue, number is also indicated.

On the surface of the ingot, GOST allows cleaned concavities up to 3 mm deep. Also, concavities formed due to shrinkage of the metal are not considered a marriage; its depth is allowed up to 5 mm.

The presence of sagging, dents, cracks, deep scratches, plaque is unacceptable on an ingot made of silver. The metal surface is smooth and uniform in color.

Bars are sold in standard and improved packaging, the price difference is 300-700 rubles, depending on the weight. It is not profitable to buy bars of light weight - the specific cost of silver is higher. Here is an example with the prices for silver from Sberbank that were relevant at the time of the preparation of the review:

for an excellent quality ingot weighing 50 grams. asking for 2301 rubles (with VAT), the cost of 1 gr. metal is equal to 46.02 rubles;
a kilogram ingot is estimated at 40002 rubles, the cost of 1 gram. is equal to 40 rubles.

The overpayment is 10%, so it is more profitable to invest in large silver bars.

Keep the documentation and packaging without opening after purchase. In the future, when selling an ingot, a bank or dealer will not need an examination of the metal if the accompanying documentation is retained.

Metal accounts

Banks offer, in addition to the usual accounts in rubles or foreign currency, to open compulsory medical insurance - an impersonal metal account. Its peculiarity is that it opens in precious metals, including silver.

Of the advantages of this method, we note:

low entry threshold, the account is opened with a few grams of precious metal;
the ability to form a portfolio of different precious metals;
physically, the metal does not have to buy and think about its storage, which means that it is easier to exchange silver for fiat currency.

Disadvantages:

investments of this type are not eligible for the personal deposit insurance program. If the bank goes bankrupt, depositors in the OMS lose all their money;
the majority of banks do not charge interest on the balance of funds on compulsory medical insurance. Accordingly, your profit is formed only due to changes in the rate of precious metals;
if the account is closed less than 3 years after opening, a 13% tax is paid on the profits.

Investment coins

Investments are also possible in silver investment coins. This is a key point - not in those that are appreciated by numismatists, but in investment coins, they are minted in millions of copies, have practically zero artistic value and their value approaches the price of metal.

buy investment coins only from banks or from certified dealers;
check the appearance and integrity of the packaging;
it is advisable not to take the coin out of the package, if you need to do this, buy special gloves. If you spoil the appearance - the bank or dealer will lower the price when buying out the investment coin;
keep the documentation.

Investment coins generally have the same benefits as bullion. But there is one big plus - the coins are exempt from VAT, which makes their price much more profitable. Dealers often have a lower coin value than a bank.

What result to expect

If your goal is to make money in the short term, investing in precious metals is not suitable. These are investments with the prospect of earning money in 5-7 years, or even more.

If you made an investment in this metal at the end of January 2010 at a price of $ 15.6 per ounce, then in 13 months you would have earned 3.17 times more than you invested. In just a year, the price of the metal rose to $ 49.2 per ounce.

Experts say that in 15-25 years the planet will run out of reserves of this precious metal, and the demand for it will not go anywhere. So this investment has potential. The growth of 2010-2011 could be repeated on a large scale.

Conclusion

At the time of preparation of the material, the cost of this metal is at historical lows. Taking into account the demand for it and the impending depletion of reserves of explored deposits, we should expect an increase in the cost of the precious metal in the future. There is only one drawback to investing in silver - it is not known when it will rise.

Article rating: Is investing in silver worth it?5

This article will focus on investing in precious metals, namely, on the prospects for investing in silver. Investments in precious metals are considered to be a reliable type of investment, because this is an asset that always has a price and, unlike money, cannot fall to zero or depreciate sharply as a result of inflation or hyperinflation or other economic shocks. But considering this kind of investment - for some reason, people are primarily aimed at buying gold. However, investment in silver currently has a higher upside potential. Why? We read about all this in the article.

Silver quotes

First you need to look at the value of silver today, so that further there is a fuller understanding of the upside potential.

Currently, the cost of one troy ounce of silver is $ 17.75. As you can see from the graph, silver reached its maximum value over the past decade in early 2011 - almost $ 43. Further, the quotes went down, a downtrend began, which lasted 5 years. And at the beginning of 2016, silver began to slowly rise.

And as you know, the best investment of money occurs when the prices of the investment object are at the bottom. After all, the cost cannot go down indefinitely, and after the fall, there is necessarily an increase. And the more and longer the decline occurred, the higher the potential for growth is in the future.

For those who are familiar with technical analysis, looking at the chart, you can also draw certain conclusions. The silver chart has broken through the resistance level. And an uptrend began. So now is the time to buy.

In addition to silver quotes, there are several prerequisites for further silver growth in the future. What kind? Let's consider them.

The ratio of the value of gold and silver

Historically, the ratio of prices for gold and silver has depended on how often it occurs in nature one in relation to another, or simply on its current reserves. Let's consider how this ratio has changed in history.

In ancient Rome, the ratio of the prices of gold to silver was 12 to 1, in the USA in the 18th century it was 14: 1. In the modern world in the early 80s of the last century 17 to 1. That is, throughout the history of mankind, this ratio was approximately the same and gold was 12-17 times more expensive than silver. This is just close to the truth, because the current ratio of the world's not-mined reserves of these metals in the earth's crust was 17.5 to 1.

What is it now?

World reserves of gold are currently estimated at 100,000 tons, and world reserves of silver at 570,000 tons. The ratio is 5.7 to 1.

The current gold quotes are $ 1318.90 per troy ounce. Silver price is $ 17.75.

The current ratio is 74.3: 1.

This happens very rarely. And every time such a ratio was reached, the price of silver "shot" upward, significantly outstripping the growth of gold.

For example, in 2008 the difference between the prices of silver and gold reached 80 to 1. Then, in a six-month period, the price of silver rose 6 TIMES FASTER than the price of gold. And for a 2-year period, the growth rate for silver exceeded gold by 2 times !!!

Gold and silver prices have been falling over the past 5 years. But silver prices fell more strongly against gold. Gold has fallen in price by 14%, and silver by as much as 60%.

Where is silver used

Silver as a metal has unique characteristics, namely: high thermal conductivity, light reflectivity and is used as a catalyst in chemical processes. Therefore, it is widely used in radio electronics, mechanical engineering, medicine and the production of many other goods, including jewelry. Separately, it should be said about the military-industrial complex. Here it is used everywhere.

The share of silver in finished products is negligible and practically does not greatly affect the final price of products. This means that with a multiple rise in the price of silver, the price of “silver-containing” goods will practically not change. And producers will still buy silver at high prices. Moreover, it is impossible to replace silver with another metal with similar characteristics at the moment, in view of the uniqueness of this metal.

Current reserves

Silver is constantly consumed in industry and, unlike gold, is practically not stored in the form of reserves. Of course, gold is also used for production, but the main purpose is the gold and foreign exchange reserves of countries. Almost every country has such reserves. And it seeks to build them up.

For example, a list of countries with the largest gold reserves:

USA - 8,133 tons
Germany - 3 380
Italy - 2,551
France - 2435
China - 1762
Russia - 1414
Switzerland - 1040
Japan - 765
Holland - 612
India - 557

Now remember if you know about the silver reserves of countries. I personally do not. The bulk of silver is consumed in the production of goods, or jewelry and silver coins. Every year the consumption of silver in the industry is only growing, and its reserves are constantly decreasing. Accordingly, with a shortage of silver, the cost, according to the law of the market, will grow.

Why is silver so cheap?

At the moment, a paradoxical situation has developed on the market, where the price of silver does not depend on the balance of supply and demand, but on speculative actions in the stock market, where derivatives play a key role, i.e. contracts (futures) for the supply of silver.

Moreover, most of them are not covered with real silver. Nobody is going to supply it to you. Profit for contract holders is generated by the exchange rate difference for silver. And given the opportunity to make deals with large leverage, contracts for silver 10, 20 and 50 more are bought (sold) for the same money. This creates the illusion that there is a lot of silver on the market. However, this is not real (physical) but paper silver.

Where to buy silver

There are 3 options for investing in silver for a private investor.

buying bullion and silver coins. But there are two things to keep in mind here. First, you won't buy a lot of silver. After all, it must then be stored somewhere in a place protected from thieves. At home is not an option, but if you rent a safe deposit box, then this is an additional cost. Secondly, when buying bars, you will significantly overpay, because the price is formed on the basis of volumes, i.e. the price for a 100 gram bar will be significantly higher than for a 10,000 kg bar. And when selling, you will be charged a tax of 18%.
OMS -. Here you can buy silver from 1 gram. Although the quotes differ from the world ones, they are very close to them. Here, first of all, you need to pay attention to the difference between buying and selling (spread). The lower it is, the better for you. More about this.
ETF - buying silver through ETFs, although reliable, is not as simple as the first 2 methods. There is no way to invest in silver through ETFs on the Russian market (there is only gold). Therefore, it remains to buy through foreign brokers.

Finally

Summing up, we have the following picture:

silver prices have been falling for the past 5 years and are now beginning to rise. Those. we can assume that the price has reached the bottom
the ratio of silver to gold prices reached 75 to 1. Each time that ratio was reached, the price of silver subsequently grew at a faster rate than gold.
the demand for silver is constant and increases from year to year, while the world's reserves are depleted, and it becomes more and more difficult to obtain silver (more expensive and more expensive). And at the moment there is nothing to replace silver.
due to the low share of the cost of silver in the goods produced, significant growth will not stop producers from buying this metal at higher prices
many silver companies are starting to cut production or stop production altogether due to low market value and low mining margins. All this in the future should create a shortage of silver in the market.
by investing in silver, in addition to the growth potential itself, you will also receive additional benefits, namely, diversification, since prices are pegged to world prices and when the national currency depreciates, you protect your investments and get additional profit by increasing the difference in rates. Those. it can be compared to investing in a currency.
the easiest and most affordable way to buy silver for an ordinary investor is through the OMS. But since metal deposits are not insured by the ASH (deposit insurance agency), choose a reliable bank.
About the goals. The first target is $ 21-22 (potential - 25%), if the price consolidates above $ 23, then the next target is $ 30-31 (potential - 75%). The time to reach the first goal is 6-8 months, the second goal is 1.5-2 years.

Happy investment !!!

Gold has been known to mankind since ancient times. Gold items have been repeatedly found in ancient burials. Since ancient times, this metal has been a symbol of wealth and power, so it became the cause of quarrels, robberies, murders and even wars.

For a very long time, it was gold that was the basis of the world financial system and until now it remains one of the hardest world currencies. Despite the fact that many years have passed since the "gold rush", gold continues to be an attractive instrument for investors along with other precious metals.

Now elite precious metals include: silver, gold, platinum and palladium. They are also called "noble", mainly for their high chemical resistance and beautiful appearance. Various jewelry is made from them. In addition, these metals and alloys with their content are used in the modern electronics industry in the production of high-tech devices, in mobile phones and computers.

You are, of course, wondering why these particular metals are valued. The main reason for their unique physical and chemical properties and scarcity... The share of extraction of "noble" metals in the total volume of products produced by the global mining industry is only 0.00005%. Obviously, given the high cost of precious metals on the world market, it is profitable to mine them.

However, opening a business for the extraction of precious metals is an expensive and rather complicated undertaking. However, everyone the modern investor can buy some gold or platinum for himself at any time.

Investing in precious metals [how to buy gold]

In Russia now to commit investments in gold and other precious metals there are several different ways available: buying bullion, coins, opening a "metal account" in a bank, purchased securities of gold mining companies or shares backed by gold.

Let's take a closer look at each method separately.

Precious metal bars

Many domestic banks offer to buy bullion from precious metals.

For example, in Sberbank you can buy gold in measured bars of the following weight categories:

Gold from 1 to 1000 g;
Silver from 50 g to 1000 g;
Palladium and Platinum 5 g to 100 g

On the one hand, it may seem that this the easiest and most profitable way to buy precious metals, but there are a number of pitfalls that an inexperienced person may simply not know about.

The problems are mainly related to the current Tax Code. The fact is that gold bars are legally property, and, therefore, upon sale, they are subject to VAT (which is + 18% to the nominal value of the metal). But that's not all.

If you intend to sell your bullion to a bank, then you will have to pay another 13% income tax.

Consequently, investment in gold bars taking into account the existing peculiarities of domestic tax legislation, they are not very profitable. In order to cover the costs, it is necessary that the ingot should add at least 30% in price, which is quite difficult to implement even in a year.

Precious coins

All currently traded precious coins can be divided into two large groups: commemorative (collectible) and investment.

The Bank of Russia is engaged in the issue of commemorative coins in our country. Commemorative coins are usually issued in limited editions - from 100 to several thousand units.

A wide variety of coin series were issued, including: "The Red Book of Russia", "Outstanding Personalities of Russia", "Architectural Monuments of Russia", "Let's Save Our World", "Lunar Calendar", "Signs of the Zodiac", etc.

However, it is worth noting that commemorative coins are of little interest to investors. There are several reasons: the high cost due to their numismatic value, and the taxation of VAT (the same + 18% to the cost).

Consequently, commemorative coins are more popular among experienced collectors... After a few years (and sometimes tens of years), such collectible coins can be sold quite profitably.

The following rule works here - the older the coin, the more expensive it is. True, in order to sell it, you will need to look for a suitable collector buyer who is ready to shell out good ones for a coin.

As for investment coins, the purpose of this financial instrument is already defined in its name. Investment coins are issued in huge circulations exceeding millions of units, therefore they are of no value to collectors... Their main value is determined by the amount of precious metal they contain.

The most famous investment coins are, perhaps, “gold ducats”, the first such coin appeared in 1975. It should be noted that each coin from this series contains 7.742 g of pure gold of 900 standard.

There are also other series of investment coins offered. For instance:

"Sable" is a silver coin, issued for the first time in 1995, in denomination of 3 rubles. The coin contains 31.1035 g. Of 925 sterling silver.
"George the Victorious" - released in two versions: silver and gold. The gold coin began to be minted in 2006, has a face value of 50 rubles and contains 7.78 g of 999 fine gold. The silver coin appeared in 2009, has a denomination of 3 rubles and contains 31.1 grams of 999 silver.

In addition, in Russian banks you can buy some foreign investment coins made of precious metals, for example, English "sovereigns".

The market value of investment coins is formed primarily on the basis of the value of the precious metal contained in them, as well as the premium, which provides for covering the costs of their minting and sale.

Buying investment coins It is convenient because many large Russian banks are now working with them, although Sberbank is perhaps the main seller. These coins have been in rather great demand in recent years, the price of some coins has increased several times since the release.

Another advantage is that transactions with investment coins are not subject to VAT in accordance with the RF Tax Code. Although 13% of the sales tax will still have to be paid to the state. (This should also be taken into account when choosing an investment instrument).

I also note that all operations with these coins are performed at the market value, which is set by the bank. Typically, the difference between the purchase price and the sale price reaches 10%.

Metal bank account

Metal accounts are divided into two types:

safekeeping account (SOC);
impersonal "metal" account (OMS).

An investor, opening a ROC in a bank, transfers to a credit institution the ingots of precious metals he has for safekeeping. Each ingot has certain characteristics: number, fineness, weight, refinery, etc. In turn, the bank undertakes to return the ingot to the client at his first request.

A safekeeping account can also provide for the possibility of transferring metal to another account specified by the client, or use it as collateral when receiving loans.

COX cannot be used as a tool for generating income, it does not imply the accrual of any interest. On the contrary, the client must pay for the bank's services for storing his precious metal. This instrument is intended, rather, to save the bullion available to the investor in kind, and the bank simply guarantees their safety.

Depersonalized metal account (OMS) in essence, it is a classic foreign exchange deposit, where the currency is the number of grams of metal. On such an account, bars are counted without specifying any specific characteristics.

You can replenish an impersonal account by making a non-cash transfer from another "metal" account, depositing precious metals in physical form, purchasing metal (in an impersonal form) for cash at the exchange rate of the bank.

OMS sometimes provides for the accrual of interest (in monetary terms or in grams of precious metal). However, interest is not always charged, you should find out about this when opening an account. The percentages are usually small - from 0.1% to 3-4%.

Obviously, if the compulsory medical insurance does not provide for the accrual of interest, then the investor can make a profit only on the condition that the precious metal rises in price.

It should also be noted here that if you want to receive an ingot equivalent to the amount of precious metal in your account in physical form, then upon receipt of the ingot will have to pay 18% VAT... If you simply close the account and receive the amount in monetary terms, then you will not have to pay VAT.

In addition, although the OMS is a kind of foreign currency deposit, it is not covered by the law on. So you have to be very careful when choosing a bank.

Gold Backed Securities

This is a relatively new option. investing in gold, which not only provides a profitable investment, but also does not require paying VAT.

The issue of shares backed by gold is handled by the World Gold Council (WGC), which was created by the world's largest gold mining companies.

The WGC has created a special fund Gold Bullion Securities (GBS) for the issue of "gold" securities, which is engaged in their placement on the Australian, London, New York and American stock exchanges (in America, "gold" shares are placed on behalf of other funds and under other tickers, but with direct support from the WGC).

One such paper gives the investor the right to receive 3.1 g of pure gold from the vaults of HSBC Bank in London.

Only privileged holders can redeem the gold-backed securities in their possession ahead of schedule by exchanging them for gold bullion in physical form. For other investors, only the option is available that provides for the payment of the corresponding amount in dollars, euros or pounds sterling.

As for Russian investors, they can perform any operations with "gold" securities using the services of many brokerage firms that operate on the exchanges listed above.

Buying shares in gold mining companies

This method, in principle, is not associated with the direct purchase of the precious metal, but still has a direct bearing on the gold mining industry, so we will tell you a little about it.

Since this investment option involves the purchase of shares, then to purchase them, you should contact and use the services of brokers. Among the main gold mining companies, whose shares are now traded on the stock exchange, it is possible to note:

OJSC Polyus Gold;
JSC "Buryatzoloto";
OJSC Polymetal.

Of course, this option involves making a profit mainly from speculative transactions with securities on the stock exchange. The level of income in this case depends solely on the growth in the value of the purchased.

In this case, the quotes directly depend on both world gold pricesand from the main financial indicators of the companies themselves.

In addition, the purchase of shares provides for the payment of dividends, which is also an additional income from investment.

Return on investment in precious metals

To assess the potential return on investments in dredges. metals, consider the statistics of quotations for the period from January 2003 to January 2012. Statistics on prices for gold, platinum, silver and palladium are shown in Table 1 (data taken from the official website of the Bank of Russia as of the first business day of each year).

Table 1. Quotations of precious metals according to the Central Bank of the Russian Federation January 2003 - January 2012, in rubles for 1

Gold price chart according to the Central Bank

Palladium price chart according to the Central Bank

Platinum price chart according to the Central Bank

Silver price chart according to the Central Bank

Now, in order to assess the dynamics of prices, let's calculate the yield for each of the metals. The final data showing the profitability in% in relation to the previous year is shown in Table 2.

As you can see from the table, over the past year all metals, except for gold, have lost in value. Platinum and palladium fell especially noticeably (-11.5% and -15.96%, respectively), which had shown good results in terms of price growth over the previous two years. Silver lost just over 1% in 2011.

This should not be viewed as a tendency for the price to fall further, as in the first month of 2012 silver, platinum and palladium are showing stable growth.

As for the minor downsides noted in 2005, this reflects only minor market price fluctuations. This can be clearly seen on the graph. But the fall in prices for silver, platinum and palladium in 2008 is an indicator of the general decline in the market under the influence of the global financial crisis. This, in fact, is responsible for the fall in prices recorded at the end of 2011. Since the market last year was again somewhat tense and unstable, the majority of players did not take risks in anticipation of a new wave of the crisis.

As for the forecasts, it all depends on whether the crisis starts or not. There is no unequivocal opinion among experts. However, it is unlikely that there will be a sharp drop in precious metals prices. Fluctuations are possible, but the forecasts are generally positive.

Note that you should be as careful about buying palladium as possible, its price often jumps: then plus, then minus. This is noticeable both from the data in Table 2 and from the chart of quotations of the Bank of Russia. The fact is that this metal is most often used for speculation in the market.

If we consider the change in the price of metals for 10 years, then silver shows the highest yield (+ 661%) and gold (+ 614.5%). Platinum has risen in price by almost 320% in 10 years. But palladium is only 152%.

This indicator suggests that in the long term, all metals provide good returns and their purchase is a very profitable investment.

In conclusion, I would like to say that investments in precious metals have a number of significant advantages over other financial instruments:

The precious metals market is more stable compared to investments in various funds, be it). This property makes them in demand precisely during a crisis, when investments in the stock market become very risky.

As a disadvantage, one can name the fact that one cannot get a quick return on investments in precious metals, they cannot provide a quick capital increase. Precious metals are a long-term investment instrument.

Dessert video: Incredible collision of magnets in slow motion

Coming from the RF Armed Forces a year and a half ago, I found the accumulated funds during my absence from various partner programs in the amount of about 50K rubles. Plus, I had over 100,000 rubles in a book in Sberbank. I began to save this money on the sly, having read several books on achieving financial independence a la "Rich Dad Poor Dad". Someone, of course, spits on them, they say, these authors only cash in on books, and they themselves have not earned a penny. But nevertheless, they provide basic concepts. The truths in them seem to be simple, but 95% of people do not reach them with their minds, simply not thinking about the "rat race", assets / liabilities and so on. I don't remember in which of them I got the term "financial safety cushion", but I liked its idea and I started to create it for myself.

Financial airbag - this is when you have a certain amount of money that will allow you to live at least six months or a year without significantly reducing the standard of living.

Surprisingly, many people spend all the money they earn, and then bite their elbows when they are fired / lose their business, and they cannot find a new job within a month. I had accumulated a sufficient amount so that I could live just about a year, but a natural question arose: where to put them?

There was not much choice. All stocks, bonds, futures and options require careful study and an impressive amount of money.
I don't know why, but instead of the usual deposit at the standard 10%, I began to look closely at precious metals. It is like a long-term investment, metals are always in price and are slowly growing.

Gold, platinum, palladium, silver are bought primarily in order to preserve savings, to protect themselves from inflation and depreciation of money.

The precious metals market is more stable compared to the securities market and investments in various funds, be it mutual funds or OFBU.

If we consider the change in the price of metals for 10 years, then the maximum yield is shown by silver (+ 661%) and gold (+ 614.5%). Platinum has risen in price by almost 320% in 10 years. But palladium is only 152%.
This indicator suggests that in the long term, all metals provide good returns and their purchase is a very profitable investment.

In Russia, several different ways are now available to invest in gold and other precious metals: buying bullion, coins, opening a metal account in a bank, purchased securities of gold mining companies or shares backed by gold.

Most of these expressions assured me of the reliability of this type of investment. And as far as I remember, only a couple of dozens of articles I read warned that the economy is cyclical and in general, prices for metals are greatly inflated and do not correspond to the truth. In another article I read that the prices for gold are inflated and they will soon collapse rapidly, but there is less and less silver left on Earth, because It is actively used in industry, in the manufacture of something there for technology, so silver quotes may rise sharply in the next few years. For some reason, I immediately believed it and ran to the bank to buy exactly silver.

In my town, despite the presence of a heap of branches of large banks, only Sberbank carried out operations with precious metals. I decided not to bother and open an account in OMS - an impersonal metal account, tk. the sale is not subject to VAT (which is + 18% to the nominal value of the metal), and then another 13% income tax, in contrast to physical ingots.

As of July 9, 2012, for the Penza region (they differ), it was possible to buy silver for 31.5 rubles / g. My savings were just enough for 5 kg of silver \u003d 157,500 rubles. The procedure went quickly and painlessly due to the fact that I had money on my book also in Sberbank, and the account itself was tied to WebMoney. So the entire amount was simply transferred to the OMS, giving me a new book with 5 kg of silver only in numbers:

Nothing boded trouble, I occasionally looked at the dynamics of changes in quotations, noting that the fluctuations were insignificant and, in fact, the price of silver was at the same level, until at one unpleasant moment in the spring of 2013 I saw the following picture:

And, unfortunately, it continues to deteriorate today. Today you can buy at 22.9 rubles. per gram, and sell at 19 !!! Those. upon sale, I will receive only 95,000 rubles, having lost 62K rubles as a result.

Investment in gold

Gold, as well as all other precious metals, also dropped significantly in price. I calculated that if I had invested the same money in gold, then I had 90.4 grams on my account (1,742 rubles / gram at that time).
Now gold costs 1256 r / g, which means I would get 113 542 rubles. (- 44K). Better than the situation with silver, of course, but still bad.

Here is your "reliable long-term investment". Not that they didn’t save it from inflation, but it was reduced by another third. You don't need to be an analyst to understand that there is definitely no hope of recovery even to the previous rate in the next 5 years.

To summarize

This is how I incorrectly tried to create a financial cushion for myself. Surprisingly, but practically not upset, because the amount is not so big to tear the hair out there on the ass. But the experience of investing appeared and the understanding that any investment is a risk, and when investing you need to mentally part with your money, and it makes no sense to read various forecasts and blindly trust them.