Thursday, June 2, 2011

How to buy Silver Bullion on eBay

from Gold and Silver Hallmarks

Silver metal in its bulk form is known as bullion. Silver Bullion is traded on the commodity markets. Bullion metals may be cast into ingots, or minted into coins. The defining attribute of bullion is that it is valued by its mass and purity rather than by a face value like money.

Buying silver bullion on eBay can be difficult but, if the price is right Bullion coins and bars are often quite attractive and fun to collect just as hobby and conversation pieces. Some simple wisdom may help you to be aware of some of the problems when purchasing silver bullion.

In the UK, new silver bullion is subject to VAT which does remove some of its investment potential. Second hand silver does not and eBay is a good place to buy this. If you want to buy large amounts of silver bullion then eBay is not the best place to do this because the mark-up is usually quite large, although you can find bargains.

In terms of investment, 1oz silver bullion coins are often considered preferential to silver bars as they can often be picked up cheaper ounce for ounce and also have a numismatic value that may increase over time. Bullion bars are more impressive and can be purchased in larger forms. (Anything from a few grams to about 500oz).

Silver bullion usually comes in three purities;

FINE (.999 or 99.9% silver),
BRITANNIA (.975 or 97.5% silver)
STERLING (.925 or 92.5% silver).
FINE silver is the most expensive.

Bear in mind the market value of silver before purchase (often if the mark-up of a bullion product is greater than 100%), you may be able to find it elsewhere for cheaper- sometimes on another eBay auction. Contrary to popular belief, silver bullion is not difficult to get hold of in the USA; however in the UK there are only a few outlets that will sell silver on a small scale.

Rules to remember when bidding on silver bullion:

1. As with all eBay items, shop around for prices, and bear in mind the current market value of bullion
2. Avoid too-good-to-be-true prices and "Chinese dynasty" type silver brick-bars
3. Stick to well known assayers/refiners, and buy bullion coins if you are interested in long-term investment potential

With silver bullion, as well as gold and platinum, if the price seems too good to be true,  
AVOID: In particular, avoid the "Chinese dynasty" silver bars that come up from time to time as it is extremely difficult to prove the authenticity of these bars. Assume fake, or silver plated at best!

To guarantee authenticity, stick to big name assayers/refiners like Credit Suisse, Johnson Matthey, Engelhard, Northwest Territorial Mint, A-Mark, Pamp Suisse etc.