Precious Metals

Stay up to date with the latest news in precious metals and find out which gold and silver-based digital currencies and stablecoins are worth investing in.

Take a deep dive into the world of physical gold and silver investing with financial market insiders and explore trading tips and saving opportunities with precious metals experts.

A Bottom may be Forming in the Precious Metals Sector

HUI: SPX Ratio The chart below shows the HUI: SPX ratio, where HUI is the Amex Gold Bugs Index 14 major gold-producing companies, and the SPX represents the S&P 500 stock market index. The price of gold is shown by the black line, with the data recorded from the year 2000.  The only time mining stocks have been cheaper relative to the stock market was in late 2000, when the secular precious metals bull market was emerging. Since late 2015, when the ratio fell to its current level, the mining stocks and precious metals have been in an uptrend, albeit with a high degree of volatility. What also stands out in the chart is that the spread between the price of gold and the HUI: SPX ratio is considerably wider now than it has been at any time going back to at least 2000. For me, this suggests that not only might a bottom be forming, but any move higher has a strong possibility of sustainability. A Bottom in the Gold Market? The rallies in the sector since late 2015 have been relatively short in duration - six months in 2016 and twenty-two months from late 2018 to August 2020. By "sustainability," I mean a bull move that lasts at least three years, like the ones from 2001-2004, 2005-2008 and 2008 to 2011. I’ve received many emails on the question of whether people should be selling, hedging or holding at the moment. I have been struggling with that dilemma ever since I sold a big position in NUGT puts. Direxion Daily Gold Miners Index Bull 2X Shares (NUGT) is a leveraged exchange-traded fund (ETF), I was using to hedge at the end of April. While I regret not keeping the hedge in place with 20/20 hindsight, the current decline in the sector is reaching historic extremes. Sell or Hold? That is the Question As for whether or not to sell at this point. I'm going to hold. I've survived sell-offs like this in the summers of 2006 and 2008 plus the sell-off in late 2018. I would be shocked if the sector is entering an extended decline like the one that occurred from last 2011 to the end of 2015. One reason, aside from the glaring strength of the fundamentals that support much higher prices in the precious metals sector, is that there has not yet been a frenzied, parabolic, high-volume price-chasing move higher. The best example of that is the run-up in the entire sector that occurred in late 2010 and into the spring of 2011. Indicators of Metals Sector Bottoming I'm starting to see several indicators that have been present in the past when the precious metals sector is bottoming. Both gold and the mining stocks (Amex Gold Bugs Index) are as extremely cheap/oversold relative to the S&P 500 as at any time going back to 2001 when the precious metals bull was beginning. Second, the hedge funds per the weekly Comex Commitment of Traders report are now net short both paper silver and gold (the gross short position exceeds the gross long position). It's rare when the hedge funds go net short Comex gold futures. The banks are net long silver contracts and they are aggressively covering their gross gold short position. Historically, this positioning in Comex gold and silver futures between the banks and the hedge funds has often preceded big moves higher in the entire precious metals sector. Finally, Newmont Mining (NEM) after its post-earnings blood-bath in the stock market on July 25th is at its most oversold technically going back to 1987 (the Dow plunged 25% in October 1987). This is another indicator that the sector may be bottoming. Precious Metals & Stock Market Divergence This is not to say that gold, silver and mining stocks will not go lower from here. Anything can happen if the stock market falls off of a cliff, the risk of which is quite high currently. However, I believe that most of the potential sellers are now sold out of their long positions in the mining stocks. Furthermore, in addition to being short gold and silver futures contracts, the hedge funds are also likely shorting mining stocks via GDX. In any indication of rally in the sector, the hedge funds will quickly cover their short positions and go long. It's my strong conviction that ultimately, whether or not the stock market has a considerable amount of additional downside - and I believe it does - at some point the precious metals sector will diverge positively from the rest of the stock market and head eventually to new all-time highs. See November 2008 to March 2011 for an example of this occurrence. Dave Kranzler is a hedge fund manager, precious metals analyst, and author. After years of trading expertise build-up on Wall Street, Dave now co-manages a Denver-based, precious metals and mining stock investment fund. This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis. The views expressed in this article are those held by Dave Kranzler and not Kinesis.

Dave Kranzler
Dave Kranzler

04/08/2022

Gold ETFs vs Digital Gold

When hearing about the potential returns from Gold ETFs, it can be an easy bandwagon to jump on. The promises of market exposure and returns without the necessity for ownership can seem appealing - at a first glance. However, an aspect less explored in the discussion of Gold ETFs is the potential risks they entail. These can often be downplayed by providers as part and parcel of the inherent structure and operation of Gold ETFs. Keep reading to find out more about the differences between these two types of gold investment, and why investing in gold shares is not the same as digitalised gold. What is digital gold (gold-backed crypto)? Digital gold - often termed gold-backed crypto - is transforming the nature of gold investment, and reinventing the asset by increasing its liquidity and making it more readily available via the blockchain. Gold-backed crypto is a digital representation of the underlying asset, physical gold bullion. With the most providers, gold-backed coins or tokens are allocated on a 1:1 basis, with their equivalent amount in physical gold bullion. For instance, one KAU is backed by one gram of physically allocated gold. Alongside the advent of blockchain, digital gold has risen in popularity in recent years, reducing the barriers to entry for individuals seeking access to gold investment. And, although a relatively new innovation, digital gold is making waves by securing individuals with an alternative form of payment to fiat currencies. With many analysts arguing that the market is displaying behaviour typical of a recessionary economy, the constantly evolving technology of blockchain is enabling individuals to take ownership of an asset, recognised for its safe-haven properties. Why choose digital gold? Purchasing digital gold currencies can be an advantageous method of acquiring the asset - especially in comparison to unbacked digital currencies. Store of Value The value of gold-backed crypto is derived from the fact that every single coin or token is pegged to a physical, tangible asset. For this reason, many recognise that asset-backed ‘stablecoins’ have the ability to circumvent one of crypto’s major pitfalls - a lack of intrinsic value, which leaves them vulnerable to severe price fluctuations. Safe Haven While physical backing is important, digital gold owes credence to backing from an asset that has been considered a ‘safe haven’ investment for millennia. Investors in the metal benefit from the fact that gold has maintained its purchasing power throughout time, due to the fact that it cannot be printed - rather, only minted. In the current economic climate, many are returning to gold in response to high levels of inflation on both sides of the Atlantic - those not seen for 40 years - as well as a particularly volatile market already in play. Utility as Money Another aspect of gold-backed crypto to consider is the sheer fact that it is transforming the metals industry, reshaping its utility beyond an investment vehicle, into a global, borderless currency. With the addition of a card, users are able to spend their bullion at the exact point of sale, in seconds. The aid of the blockchain offers the potential for individuals to integrate gold as a standard part of their daily payments - just like any other currency. Not to mention, although gold-backed crypto is a digital currency, users are entitled to redeem the underlying gold backing their coins anytime they wish to, with providers like Kinesis offering redemption from as low as 100g for gold. Auditing As a finer point, it is a given that digital gold is readily associated with the transparency and immutability of the blockchain, to account for all coins or tokens in circulation. But while the blockchain itself does provide a safeguard in that matter, auditing for the physical metals is also essential to consider. It’s important to ensure that any gold-backed cryptocurrency provider completes frequent, independent audits by industry specialists, to verify their holdings against coins or tokens. What are gold ETFs? Gold Exchange-traded Funds are known under the broader umbrella term of Commodity ETFs, which are used for investment into raw goods, such as precious metals or crude oil. Investors typically select ETFs as a way to diversify their portfolios, with these funds offering exposure to a pool of bonds, stocks, or other assets, without the need to acquire each of them separately. When an investor buys stocks, they invest entirely in one company, whereas ETF investment gives the option for investors or traders to buy a single or multiple shares within an ETF. For a more detailed breakdown of ETFs, see our blog post here. Some of the most popular gold ETFs hold physical gold to back their shares, with the share price tracking the price of gold. Due to the ease at which they can be traded, ETFs are often the cause of volatility in the gold market, with those holding gold ETFs often the first to be impacted by market movements - for better, or worse. ETF investments are handled passively since returns are gathered from the tracked valuation of pooled assets rather than usage within a system. In light of this, investors have little control over their potential returns, than if they were garnered through spending or trading the asset itself, for example. Gold ETFs - the pitfalls For new starters in the field of gold ETFs, this avenue can at first appear as a cost-effective way to access gold and a substitute for owning the physical asset. However, there are also some significant risks to consider associated with this avenue. Real Exposure? While many argue that gold ETFs offer exposure to physical gold, investment in one does not guarantee legal title ownership of the asset itself. This means that if or when the investor opts to redeem their shares, the ETF provider is not contractually obliged to supply them with a single gram of gold, and is well within their right to provide a ‘cash equivalent’. This begs the question of whether ETFs can truly provide exposure to the physical gold market if the investor cannot take ownership of the underlying asset. One of the leading providers in the Gold ETF market specifies that investors must own a minimum of 100,000 shares before they can submit a request to redeem gold, and even then, the provider can settle in cash. Counterparty Risk Another aspect to point out is the importance of physical allocation when considering buying gold. Since Gold ETFs are traded on the commodities market, they are subject to counterparty risk. It is often the case that the value of ETF shares issued is greater than the value of the gold owned by the fund, which becomes a problem in the event of insolvency of the custodian or sub-custodian. This is the risk that holders of ETF shares must be willing to take and is an increasing possibility in times of unforeseen market circumstances or poor market decisions. Even concerning leading funds in the precious metals space, the issue of unallocated gold can leave investors vulnerable to an ETF provider's unfulfilled obligations and their consequences. Digital gold vs gold ETFs The challenge of weighing up the optimal asset for both long-term investors and active traders often leads those contemplating gold to navigate towards the outwardly simple and easy access world of ETFs. However, it is only later down the line that these same investors can be met with a whole host of maintenance fees, counterparty risk and lack of control over ETF investment. It is worth considering that digital gold combines all the properties of physical gold - ownership, asset control, proven value, and portfolio diversification - attracting investors to this option in the first place. Digital gold gives individuals the opportunity to access this, all while combining the benefits normally associated with ETFs, such as flexible trading, and in some cases, zero storage fees on insured gold bullion.  In the form of digital gold, access to gold investment is much simpler and more efficient for anyone seeking to benefit from the metal, with Kinesis now providing that opportunity through a bespoke platform and easy-to-use interface.  At a time when inflation is skyrocketing, and the value of certain fiat currencies is cascading down a steepening slope into decline, digitalised gold (KAU) brings investors in contact with fully allocated, legal title ownership of physical bullion.  Rather than an investment solely based on paper market trading, gold on the blockchain leverages the gold investment proposition by combining the liquidity, and low-cost trading normally associated with ETFs, with ownership of the physical asset. Traders and spenders of Kinesis Gold can also participate in a usage-based yields system, where a portion of transaction fees are shared with users across the entire network, every month. Find out how Kinesis is transforming gold investment Learn More This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.

Latifa Alkhanjary
Latifa Alkhanjary

28/07/2022

What is a Troy Ounce of Gold?

What is a troy ounce? How many grams in a troy ounce of gold? How to convert troy ounces of gold into grams? In this article we will focus on these topics, analysing the value of an ounce of gold today. How many grams in a troy ounce of gold? The Troy ounce is the most used metric for precious metals as well as in modern gold trading. One troy ounce equals 31.1035 grams, so 10 ounces of gold would correspond to about 311 grams. The troy ounce today How much is gold worth per ounce? The price of gold constantly fluctuates and is largely driven by market sentiment. If there is more buying interest, the gold price increases. Whereas, when there are more sellers, the price of bullion declines. Having up-to-date knowledge of the price of one ounce is crucial for investors. Indeed, many derivatives contracts related to gold, such as futures and options, are priced in ounces. Troy ounce vs ounce The officially recognised unit for gold is the troy ounce, but while talking about ounces, we should be careful in order to avoid confusion between ounces and troy ounces. A troy ounce is about 10% heavier than the standard ounce used to measure household items, such as sugar. So while a troy ounce equates to 31.1035 grams, an imperial ounce, or avoirdupois ounce to give it its full title, comes in at 28.35 grams. Previously used by the British Empire, the troy ounce is now the international measurement for the weight of precious metals and gemstones, as well as gunpowder. The word ounce derives from Mediaeval French, which in turn comes from the Latin word ‘uncia’, derived from ‘unu’, meaning one. The troy measurement system has been in use since the end of the fourteenth century, gaining its name from the French city of Troyes, where it was used in the Middle Ages as a reference for weight measurements at the local town fair. The troy ounce was already in use around 1400 in Britain’s private sector and was also adopted as coinage from 1527. Understanding the per ounce gold pricing How can we understand the price of gold per ounce? It is relatively simple. Indeed, if we have the price of gold in dollars per gram, we should multiply this by 31.1035. For example, if the price of gold is $60 per gram, the value of an ounce of gold will be 60 multiplied by 31.1035, which equals $1,866.21. Let’s now examine that price in different currencies considering that gold is a global commodity featuring in investor portfolios all over the world. To convert the price of gold into other currencies, such as the British pound, the Japanese yen, or the Euro, it is the same initial process (by multiplying the price in dollars per gram by 31.1035) and then converting this with the spot exchange rate. For example, let us imagine that the price of 1 gram of gold is $60 and the Euro/US dollar exchange rate is 1.05. What will the equivalent price of one gram and one ounce of gold be in Euros? The price of one gram of gold in Euro will be equal to 60 divided by 1.05, equalling €57.14, while the price of one ounce of gold will be equal to 60 multiplied by 31.1035 divided by 1.05, which comes to about €1,777. How much is an ounce of gold worth? The next question relates to the real worth of an ounce of gold. Of course, if we are talking about physical gold we should consider the purity of gold, which is measured in carats. This is the most widely used metric for measuring gold purity, where 24 carats represent the highest level of purity. The most used carat measurements are as follows: • 8 carats = 333 thousandths per gram • 12 carats = 500 thousandths per gram • 14 carats = 585 thousandths per gram • 18 carats = 750 thousandths per gram • 22 carats = 916 thousandths per gram • 24 carats = 999 thousandths per gram On financial markets, investors are almost always trading gold with very high purity or contracts with bars of gold containing at least 99.9% gold. What is the price of one ounce of gold today? To find out the price of one ounce of gold you need to look no further than Kinesis’ wide selection of charts, pulling live data from the physical bullion market. You can monitor the price of physical gold bullion, aggregated across 6 continents on our live gold price chart. What is the value of gold today? Gold has a history dating back centuries. It plays a key role in the financial sector, representing the safe haven at times of market turmoil, while also being used by central banks as a key part of their reserves. The jewellery sector alone uses around 2,000 tonnes of gold. As for the total available supply of gold, it is finite in the sense that humanity is unable to create or fabricate it which is why gold is often seen as a crucial part of any given financial portfolio. Gold remains to be a valuable asset for numerous reasons, with this reputation likely to continue for the foreseeable future. Carlo Alberto De Casa is an external Market Analyst for Kinesis Money, responsible for updating the community with insights and analysis on the gold and silver markets. Carlo provides regular commentary for UK notable outlets including the BBC, Telegraph, The Independent, Bloomberg, FX Empire and Reuters. With a credential background in Economic Finance and International Exchange (MA), his critical analysis on gold and silver’s markets performance is frequently quoted by leading publications, week-on-week. This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.

Carlo Alberto De Casa
Carlo Alberto De Casa

14/07/2022

Why is gold so valuable and what makes it so precious?

The history of man’s relationship with gold dates back many millennia with its golden colour immediately catching the eye. Over time it evolved from a desirable decorative asset to a currency used the world over. While gold no longer underpins the world’s currencies, it retains its investment appeal as an asset class that investors are encouraged to own a stake of to diversify their portfolio with the daily price of the metal closely monitored. But what is it that has led to gold’s enduring appeal lasting for thousands of years and why is it deemed a precious metal? Why is gold so valuable? A key reason for gold’s value is the finite amount of supply of the metal. It is estimated that just over 200,000 tons of gold have been mined over the course of history, the bulk of which has been in the last 70 years, according to the World Gold Council. Ever since it first caught the eye of man, its shine and colour have given gold considerable decorative appeal and this is reflected in the fact that almost half of this mined gold has been made into jewellery. This love of gold is true across the world with the metal even associated with the gods. In South America, the Incas and other Andean communities considered gold to be “the sweat of the sun”. In Ancient Egypt, where gold is thought to have first been discovered, the people thought the metal was the flesh of the sun god Ra. In India, gold is considered to be auspicious, particularly among the Hindu and Jain communities, with the metal used to adorn gods and to celebrate births and marriages. Gold symbolises wealth and prosperity with India one of the largest buyers of the metal today. As well as its decorative qualities and association with the gods, the metal also possesses a unique blend of chemical qualities that add to its value. Crucially, it is unreactive with other elements so retains its same lustre and quality over centuries. It doesn’t tarnish or corrode over time, it isn’t toxic while its strength makes it tough to break. Gold also has a relatively low melting point that enabled the early communities that first discovered it to work the metal into items such as jewellery. For other elements, the high temperatures needed to melt them have only recently made them accessible. In recent times, these qualities have seen it used in a wide range of technological and scientific applications, including in tests for diseases including coronavirus, in astronauts’ visors as well as in the circuit board of iPhones. Why is gold so expensive? Gold’s value is only derived from what we as humans place on it. Yet this long-lasting appeal for this golden, shiny metal allied to its widespread adoption as a currency and then more recently as a key component in certain industries has resulted in the price of an ounce of gold topping $2,000 an ounce at times. The relative rarity of gold is a key factor in its high price. Yet there is more to gold’s price than purely fundamental supply and demand economics. Silver, which shares many of the qualities of gold, has an annual production of about 1 billion ounces compared with about 150 million ounces for gold. However, rather than trade at a multiple of about 8 times greater than silver, which this supply difference would imply, gold trades for between 75 times to 90 times the price of silver. This is down to the huge investment market that surrounds gold with the amount of gold traded daily far outweighing the total physical supply of the metal. Gold as an investment Gold’s investment case is built on its lack of correlation with other asset classes and its proven ability to hold its value over centuries. The finite amount of supply, in contrast to fiat currencies controlled by central banks who can print more money as needed, has led to gold to be considered a good hedge against inflation. For many decades, many of the world’s currencies were backed against gold, with the central banks required to have the equivalent amount of gold for each dollar or other currency in circulation. This was known as the Gold Standard and while governments moved away from this in the 1970s, the central banks continue to hoard vast quantities of gold, amounting to about 35,000 tons, or about a fifth of the amount of gold ever mined. At times of crisis, be that war or economic slowdown, investors have often fled to “safe-haven” assets such as gold with an ounce of physical gold more attractive while the share of an individual stock or indeed the broader index is plunging. While global equities, and the individual companies they are comprised of, typically move on the same drivers such as economic data, gold’s relatively small industrial usage means it is driven more by sentiment than hard numbers. This lack of correlation to other asset classes is a key reason why investors typically consider holding between 5 and 10 per cent of their portfolio in gold. When other assets are plunging, gold can be relied upon to continue ticking over steadily in the background, preserving a chunk of an investor’s wealth. In summary, gold’s value and preciousness is almost entirely down to the desirability humans have placed upon it. But with this attraction having passed down from the Ancient Egyptians through to modern-day India, the chances of that appeal dwindling any time soon seem remote. Rupertis a Market Analyst forKinesis Money, responsible for updating the community with insights and analysis on the gold and silver markets. He brings with him a breadth of experience inwriting about energy and commodities having worked as an oil markets reporter and then precious metals reporter during the seven years he worked at Bloomberg News. As well as market analysis, Rupert writes longer-form thought leadership pieces on topics ranging from carbon markets, the growth of renewableenergy and the challenges of avoiding greenwash while investing sustainably. This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.

Rupert Rowling
Rupert Rowling

24/06/2022

Is Silver A Good Investment in The Long Term?

While silver may not receive the same level of attention as gold, it shares many of the qualities as its golden peer and can claim a history that dates back almost as long. As such, there is a multi-century trading performance of silver to reflect on when assessing its investment qualities over the long term. Indeed, it is this enduring appeal, as well as it being a physical asset with a finite amount of supply, that has given silver status as an asset that holds its value over time and is a hedge against inflation. As for the investment case for silver, that can be split into two principal categories: first, as a safe haven asset, worth for an investor to have in their portfolios, to protect them at times of crisis;secondly, in contrast to gold, silver has considerable industrial demand, with the metal used in a wide range of technological applications, notably as a key component in photovoltaic cells for solar energy as well as a number of different elements of the drivetrain for electric vehicles such as Tesla. But how has silver actually performed versus other asset classes? And is it worth investing in the metal now? Silver performance vs stock market Both the stock market and silver are prone to periods of high volatility that can result in sharp gains and losses over a short period of time. Silver in particular is more prone to volatility than gold due to the lower trading volumes compared with its precious metal peer, which is one of the most traded commodities in the world. As such, these comparatively lower volumes can see silver suffer much wilder moves in both directions, than the steadier performer - gold. Yet while it shares the risk of volatility with equities, a crucial separating factor is that the main drivers for the stock market can often be met with a contrasting reaction on silver, making the metal a valuable diversification asset in any portfolio. For example, for the US equities, a weaker US dollar typically reduces these companies’ buying power on the export market. However, for silver, which is priced in US dollars, a weaker greenback often helps boost the metal’s price. Similarly, given silver’s perceived role as a safe haven asset, times of crisis on equity markets, when traders are seeking to take risk off the table, can be beneficial for silver. One area where these two assets can move in tandem is an improving industrial outlook with silver benefiting from the likelihood of increased demand for the metal while the companies that make up the stock market will also rise. While typically gold and silver move in close correlation, this industrial appeal of silver can see the close relationship between the two precious metals break down. Silver performance in the last 10 years Silver may have a reputation as a store of value over time but taking a snapshot of the last 10 years, dating back to 2012, holders of silver would have seen them lose money. Indeed, it was in 2011 that silver surged close to its all-time high, briefly trading above $48 an ounce, with the metal never coming close to threatening those levels since. Silver suffered a severe plunge in its price in 2013 before then trading in a broad range of between $14 an ounce to $22 an ounce from 2014 onwards before the start of the coronavirus lockdowns in March 2020 saw it sink below $13 an ounce to its nadir of the decade. The much-documented silver squeeze of early 2021 when the metal found itself the meme stock of the day among the Reddit community and broader retail investors pushed the price of silver above $30 an ounce for the first time since 2013. This squeeze highlighted both silver’s die-hard appeal among elements of the trading community as well as the metal’s potential volatility as it is difficult to conceive such a dramatic move being conducted by retail investors on gold. In early 2022, silver was a beneficiary of the rush to haven assets in the wake of Russia’s invasion of Ukraine in late February with the price climbing to close to $27 an ounce. However, the change in monetary policy by central banks to a more hawkish stance in which interest rates are set to rise over the course of this year saw silver punished, due to its lack of yield. As a result, the metal plunged to below $21 an ounce before recovering in recent weeks to near $22 an ounce. This potted history of silver’s performance highlights both the wide array of factors that can influence the price of silver as well as its volatility. Future of silver in the next 10 years Having endured a difficult last decade in which silver endured a rollercoaster that ultimately saw it lose value over that time period, what are the prospects for the precious metal to perform any better over the next decade? The key element to silver’s potential performance over the next 10 years lies in its demand from the industry. 2021 was a record year for physical demand with increased buying from the electronics sectors, notably photovoltaics, helping push consumption in excess of 1 billion ounces, according to the Silver Institute. 2022 is set to see another record year with demand growth again led by photovoltaics, which is set to more than double from where it was in 2012 to about 127 million ounces. Silver’s outlook is brightened by the fact it is used in key growth industries such as technology, solar energy and electric cars. Efforts to thrift the metal, where manufacturers try to minimise their use, have bottomed out with demand for silver now set to grow in line with the huge growth anticipated for these major sectors. Yet silver isn’t driven by industrial demand alone, with 2022 throwing up a war in Europe and the most aggressive series of interest rate hikes by central banks seen this millennium. The reflection back on the last 10 years shows how difficult future events are to foresee. Who could have predicted the rise of meme stocks for example? Where will silver be in 2032? In truth, no one knows. But the growth prospects of physical demand allied to a finite supply point to an asset that still has plenty of room to climb higher. Is silver still a good investment? Silver certainly has a role to play as a small part of an investor’s portfolio. It performs differently to other asset classes, offering diversification and its physical quality means an investor can never be left with absolutely nothing, unlike a company that goes bust for example. Silver investors have had to endure some volatile times but its relatively low entry point, with an ounce of silver costing about $20, makes it much cheaper and easier to obtain than gold. Plus the wide range of uses for silver, in some of the most attractive industrial sectors of our time, illustrates that the metal has attractions outside of the purely investment and collector crowd. Overall, a little exposure to silver at a time of burgeoning demand is surely worth the risk. But strap in and enjoy the often bumpy and volatile ride! Rupert is a Market Analyst for Kinesis Money, responsible for updating the community with insights and analysis on the gold and silver markets. He brings with him a breadth of experience inwriting about energy and commodities having worked as an oil markets reporter and then precious metals reporter during the seven years he worked at Bloomberg News. As well as market analysis, Rupert writes longer-form thought leadership pieces on topics ranging from carbon markets, the growth of renewableenergy and the challenges of avoiding greenwashing while investing sustainably. This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.

Rupert Rowling
Rupert Rowling

17/06/2022

Most Valuable Silver Dollars in the Market Today

Silver dollars are the some of the most collectable and liquid in the coin market today, with sought after and rare examples selling for millions of dollars, including the most expensive coin ever sold. Not bad for a coin that, on the face of it, is worth just $1! What is a silver dollar? A silver dollar is a coin made by the United States Mint and was the first dollar minted in the US back in 1794. As the name suggests the dollar is made of silver, typically consisting of 90% silver and 10% copper, and is redeemable for $1. Although silver dollars date back over 300 years, the course of history has seldom run smooth. The Coinage Act of 1873 caused the first major disruption by ending the free coining of silver with production of the silver coins only resuming five years later following the Bland-Allison Act, which compelled the Treasury to buy a minimum amount of silver each month to be made into dollar coins. However, just a few years later the Sherman Silver Purchase Act of 1890 led to a surplus in the supply of dollar coins with volumes tailing off over the subsequent years until 1904 when production of the silver dollar was suspended. The end of World War I saw the passing of the Pittman Act and resulted in the first new silver dollar, known as the Peace Dollar, being minted in 1921. This coin enjoyed a short production run before war once again intervened with no coins struck by the Mint for about 30 years until the creation of the Eisenhower Dollar in the 1970s. Since that resumption, dollar coins continued to be minted in a variety of designs until 2011. Coins produced from 2012 are no longer for general circulation and are purely commemorative made specifically for collectors. The range of designs and the history behind each different coin is a key factor in why silver dollars are one of the most popular coins among collectors. Why is a silver dollar called the silver eagle? The silver eagle refers to the American Silver Eagle, which is the official investment-grade, silver bullion coin. The coin was approved by the 1985 Liberty Coin Act with the first American Eagles released in 1986. This 1-ounce coin is made of pure silver and has the Walking Liberty design on the obverse and the Bald Eagle, the national bird of the USA, on the reverse. Its weight, purity and content are backed by the US government helping make it the most widely traded silver coin in the world. Although the eagles minted before 2012 have a face value of $1, the standard coins trade for a small premium over the spot price value of the physical silver they are made of. As ever with collectable items, more unusual or proof versions of the coins can sell for considerably more. The most valuable silver dollars today The record price for a coin was achieved by a silver dollar with a 1794 “Flowing Hair” specimen that was potentially the first dollar ever to be struck by the US Mint in Philadelphia. The coin, which derives its name from the appearance of Lady Liberty on one side, sold at auction for over $10 million in 2013. Only 1,758 silver dollars were produced by the Mint in its opening run meaning that any coins from that year still around today are highly sought after by collectors. There are estimated to still be about 130 still in circulation that would attract a multi-million dollar price tag should they ever come to market. After the Flowing Hair dollars, the next most collectable silver dollars are the Morgan Dollars and the Peace Dollars. Morgan Dollars were minted from 1878 to 1904 and then again briefly in 1921. They were designed by George T. Morgan and are highly valued both for their comparative rarity and their beauty. The rare designs in mint condition can sell for between $100,000 to $550,00. The short-run of the Peace Dollar, which was minted from 1921 to 1935 with a brief return in 1965, ensures the coin is popular with collectors due to its relative scarcity. Not only did the Morgan Dollar enjoy a longer mint run, it was also produced in far greater numbers. However, although the supply was smaller, the fact it was produced more recently than the Morgan dollar means the older coin is more desired among collectors. Other coins to attract a high price include the 1885 Proof Trade Dollar of which there are only five known examples and which the US Mint has no record of ever producing it. Seated Liberty dollars from the late 1860s and 1870s are also sought after with an 1866 version missing the “In God We Trust” inscription selling for over $1 million. Such is the interest in silver dollars that they can easily be traded at bullion dealers and pawnbrokers. The dollars should be stored in air-tight containers or packets to reduce the risk of them being tarnished. With entry prices as low as $20, silver dollars offer an attractive entry point into coin collecting while the possibility to unearth a rare gem in mint condition keeps collectors dreaming of making a fortune. Rupert is a Market Analyst for Kinesis Money, responsible for updating the community with insights and analysis on the gold and silver markets. He brings with him a breadth of experience inwriting about energy and commodities having worked as an oil markets reporter and then precious metals reporter during the seven years he worked at Bloomberg News. As well as market analysis, Rupert writes longer-form thought leadership pieces on topics ranging from carbon markets, the growth of renewableenergy and the challenges of avoiding greenwashing while investing sustainably. This publication is for informational purposes only and is not intended to be a solicitation, offering or recommendation of any security, commodity, derivative, investment management service or advisory service and is not commodity trading advice. This publication does not intend to provide investment, tax or legal advice on either a general or specific basis.

Rupert Rowling
Rupert Rowling

09/06/2022