Trading gold and silver
The proliferation of the internet has made it possible for all of us to buy and sell precious metals from the comfort of the bedroom without having to step out and go to a high street retailer. Simple as this may sound, it has changed the rules of the game for both buyer and seller. Large volumes of precious metals are now traded everyday online. The phenomenon has reached as far as India. The country is one of the largest consumers of gold in the world, with the World Gold Council estimating Indian gold demand to be as high as 800 tonnes is 2018. Upon entering the digital gold market, one Indian retailer alone reported sales of $18.4mn, which is only a small fraction of the country’s insatiable demand.
How about the UK?
Meanwhile, in the UK, total gold imports in 2017 was 851 tonnes, most of which was headed for specialist bullion bar vaults in London. In fact, it was reported in October 2017 that 7,827 tonnes of gold in the form of gold bars are held in the London vaults in the custody of special custodian companies whose chief expertise is in the handling of bullion.
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A bulk of this gold comes from online traders who store gold in safe custody on behalf of clients who purchased their assets but opted to leave these in storage with the company. Indeed, this is one of the trends that has changed since online trading in gold gained popularity.
Gold bars can now be easily purchased through the internet and stored in secure vaults
Online reputation management
It’s not just the delivery and storage factor that has changed with the rise of online trading. The currency of online trading is reputation. The internet lends anonymity to traders. When it comes to valuable assets like gold, silver, platinum, etc., buyers need to be certain about who they’re dealing with. Simply having a glitzy website, a phone number and a shared office address is not enough to offer customers the confidence they need. In fact, online reputation management is an important game today. Previously, in the days of brick and mortar high street retailers, reputation was built by word of mouth. Satisfied customers simply recommended a business to people they knew.
But things have changed…
Well, it isn’t that simple any longer. As a successful online trader of precious metals, customers come from everywhere and aren’t necessarily connected with each other in any way. Additionally, with visible online ratings for every seller, any customer can view ratings before making a decision to buy. Therefore, it’s important to ensure that every sale leads to a great customer experience. It’s also important to communicate with them after the sale to remind them to leave a good review on the website. This then becomes ammunition for marketing. As more and more reviews pour in, you can rest assured that more customers are going to walk in through the door. Although this kind of online marketing is usually popular among retail stores, it is now prevalent in the world of online trading for precious metals.
Social media has changed the way precious metals are traded
Social media marketing
Several online retailers have listed themselves on popular social media pages. Interestingly, Facebook does not allow the sale of bullion. So, online traders use the site to maintain a presence and divert traffic onto their websites. Other popular social media sites where one can buy or sell precious metals include Etsy and Instagram. It is interesting to note that several online players have turned to Instagram as a form of online showcase. The site is great for posting images of precious metal products, be it jewellery, bars, coins, etc. Sure enough, these products are visually attractive and several customers are tempted to get in touch with the online trader to find out more. Facebook also has certain private groups for online traders of precious metals.
Data security
Yet another big change that has entered the world of online trading in precious metals is the security of client data and their financial details. Businesses that deal with items of value like precious metals are more likely to be hit by hackers. Simply having watertight encryption and 3D secure systems when handling customer data is not enough, it is important that customers know that the online trader is using these methods so that they feel safe and secure.
Handling confidential customer data
In keeping with data protection laws, online retailers of precious metals are expected to store customer data safely. Now, additional steps need to be taken by all online traders as the new
General Data Protection Regulation (GDPR), will kick in from 25th May, 2018 across the EU. Under the new privacy act, EU customers are expected to be able to exercise greater control over how companies process and store their personal details. This covers all personal and financial details, as well as IP addresses of computers they use and log in to. Companies need to put in place extra efforts, systems and processes in order to comply with the new directive.
Silver coins are often a popular choice for online buyers of precious metals
Advantages of buying precious metals online
The internet has changed the business models for many products and services and the precious metals trade is no exception. Standalone brick and mortar stores had limited inventory and limited options for customers in their stores. This was largely due to space constraints in their stores or warehouses. The internet changed all that. Large online traders like Physical Gold are now connected to big ticket manufacturers across the world. They are able to source products at rock bottom prices, due to economies of scale and pass on these price benefits to customers, making them highly competitive. The choice of products is huge and once customers place an order, the company is able to source them very quickly and deliver.
Another change is the way these items of value are collected by the customer. In the past, one had to go down to a high street store and take delivery. Needless to say, this places the buyer in a risky situation. These stores are frequently watched and targeted by criminals and one can be followed home, or even robbed on the way back. If the gold or silver is stored at home, this could increase the probability of the house being burgled. As discussed earlier, customers are frequently opting to have their precious purchases stored at a secure location. For example, when you buy gold or silver from Physical Gold, each item comes with a buyback guarantee, certificate of authenticity and a legal agreement of storage to prove ownership of the assets. The company stores precious metals on behalf of their customers in LBMA approved vaults. Of course, if the buyer wants to take delivery at their address, this is despatched via secured and insured delivery. There are also popular accessories available for customers to be able to keep their valuables safely in their own homes.
Gold vaults like the one above, used by the Bank of England are used for safe storage
The authenticity of the trader
It is also important to check whether the online trader is a registered, bona fide company. A quick check on the companies’ house website should quickly reveal the company details. Another source where company credentials can be checked is the British Numismatic Trade Association (BNTA). If the online trader is genuine, the firm will be registered with the BNTA.
Talk to our team of experts to buy gold online
Physical Gold is proud to be a reputed online trader, serving customers over the years. Our team of experts are always keen on helping customers make the right decision when purchasing precious metals online. If you have any queries or concerns about buying gold or silver online, please speak to our team by dialling 020 7060 9992 or get in touch online. Whether you’re new to buying precious metals, or a seasoned investor, our investment team has all the information you require to make a sound decision.
Image credits: Wikimedia Commons, Wikimedia Commons, Money Metals and Bank of England
As with any investment, there is a certain amount of risk to negotiate when investing in gold or silver. Here at Physical Gold we have many years of industry experience and can help you make an informed decision when purchasing precious metals. Here are some of our top tips for mitigating some of the risks involved in purchasing gold and silver:
Buy from a trusted dealer
When purchasing gold and silver in any form, whether it’s jewellery, bars or coins, it is always important to make sure you do so through a trusted dealer. There’s a huge amount of counterfeit goods out there, particularly online, so it’s always important to go to a recognised dealer and do some research on them beforehand. You also need to be aware of any hidden fees and costs when purchasing gold and silver as a lot of dealers advertise really low prices but then charge extortionate prices for handling, shipping costs etc. We’re members of various trade associations, including the BNTA and British Numismatic Society.
Our 7 step Cheat Sheet reveals the crucial considerations to minimise all risks. Download now
Gold and silver in the form of bullion bars and coins
Understand the pros and cons of investing in different forms of gold & silver
People invest in many different types of gold and silver. Whether it’s coins, bars or jewellery, it is always important to understand your requirements and what the best options are for you. For example, many people like to invest in bullion coins because they are easily stored and have a guaranteed purity. They are also fairly liquid should you need to raise money quickly. Some forms of gold and silver, including legal tender bullion coins such as Britannia’s and Sovereigns, also come with added tax benefits and are capital gains tax-free, making them an ideal purchase for many investors.
Do some background research
If you’re thinking about investing in gold or silver, then you should always make sure you do your research first. Have a look at look at futures tables and forecasts to make sure you get a picture of how the market is shaping up and consult with an expert if you’re unsure about anything. It is also worth checking the current spot price of gold and silver as this will give you a basic idea of what people are paying.
Think about different storage options
Before investing in any form of gold and silver, it is important to think about how you are going to store the goods. If you’re planning to store your goods at home for ease of access, then you will want to think about how this may affect your insurance and whether you have a suitable and safe place to store your gold or silver. You also need to be careful about who you divulge any info to regarding where the goods are secured as you don’t want them to be stolen.
If you’re purchasing gold and silver purely as an investment, then you might want to consider whether it’s worth storing it in an allocated vault. The cost of transporting gold and silver as well as insuring the content is often very expensive. You can save considerable costs by keeping your goods stored in a secure vault and it will also give you complete peace of mind that your items are safe and protected.
Contact Physical Gold for further advice
Physical Gold are expert brokers in gold and silver and will reduce your risks when buying precious metals. If you require any advice or additional information on how to invest in precious metals, then please give us a call on 020 7060 9992.
Image Source: Mark Herpel
Before investing in any physical commodity, whether it’s gold, silver or any other precious metal, it is always worth carrying out your own research beforehand. The internet is a great source of information and can tell you everything you need to know about beating the spread, spot prices and future price forecasts. If you’re looking for further information, iTunes is also a great place to check out. There is a great range of podcasts available giving you expert tips and advice. Best of all they are completely free. Here are 7 of the best podcasts currently available on iTunes.
Precious Metals Market Update
This Podcast is sadly no longer releasing new episodes however with over 100 episodes already amassed, it can provide you with a comprehensive overview of the gold and silver market. With expert advice from precious metals expert Tom Cloud, the podcast covers everything from global issues affecting the gold and silver price, storage advice and how gold and silver ratios can affect investors. Click here https://podcasts.apple.com/us/podcast/precious-metals-market-update/id903415429.
If you prefer reading to listening, download our FREE Insiders Guide to Gold and Silver Investment
Silver Doctors
The doc has been dishing out his expert advice on finance and economics for over a year and has so far released 100 episodes of his popular podcast in which he seeks to educate people on the benefits of investing in gold and silver. The podcast features a number of guests and experts each week who together address many important issues affecting gold and silver investments. Highlights include an interview with David Morgan of “The Morgan Report” who gives his predictions for the gold and silver market in 2018. Click here.
The Morgan Report
The Morgan Report is a vehicle for esteemed precious metals analyst David Morgan’s to talk about his perspectives and opinions on the precious metal market. Each week he gives his weekly perspective on the current state of the economy and how this could affect gold and silver investments. His podcasts are around 20 mins long and are perfect listening material when you’re on your lunch break at work or find yourself with a spare half an hour. Click here.
Learn about precious metals
Money Metals’ Weekly Market Wrap on iTunes
The granddaddy of all precious metals podcasts, Money Metals’ weekly wrap has been running since 2014 and in that time, they’ve released nearly 200 episodes of their popular podcast. Each episode clocks in at around 30 mins and focuses on how current affairs in the US are affecting the precious metal market. Industry experts including renowned precious metals expert Tom Cloud are also regularly invited onto the show. Click here.
“Gold & silver investment jargon explained” – a YouTube video we have published.
SchiffGold Friday Gold Wrap Podcast
A relatively new up and coming podcast released each Friday by US precious metal dealers SchiffGold. This quick and handy 10-minute podcast is a perfect soundbite and summary of the week’s precious metal news including some thoughtful commentary and opinions from the company themselves. Click here.
Precious Metals Investing
A short but informative podcast (some episodes are only 5 min long) that provides tips & advice on investing in the precious metals market. The podcast features Ted Sudol from PreciousMetalsInvesting.org and a weekly guest expert. Highlight episodes include “Gold futures – reading the charts” and “Bitcoin and Gold”. Click here.
The Daily Gold Podcast
A fascinating podcast hosted by Jordan Roy-Byrne,
editor and publisher of TheDailyGold.com and TheDailyGold Premium. This Podcast features regular guests from the gold industry and expert insight into where the gold industry is headed. Highlight episodes include an interview with Greg Weldon, one of the world’s premier independent macro analysts, who gives his opinions on the current state of the gold market and an update from gold exploration company Novo Resources. Click here.
Visit Physical Gold for more information
Physical Gold is one of the UK’s leading specialists in gold and silver investments. If you’ve been inspired by any of the podcasts mentioned in this article, you can find out more information on how to invest in gold and silver by checking out our website. You can also speak to one of our experts by giving us a call on 020 7060 9992.
Stories about Bitcoin and the future of cryptocurrencies are dominating the news headlines right now. Over the last few years, the concept of digital currency has entered the mainstream and it seems like everyone you meet has a different opinion. Since bitcoin became the first decentralised cryptocurrency in 2009, its market value has gone through the roof. Many banks globally now accept Bitcoin for payments, as do a growing number of retailers.
Will the bitcoin bubble burst eventually?
The question is will the Bitcoin bubble ever burst like people are suggesting? Or will other up and coming cryptocurrencies such as Ethereum become the new norm? We set out to find how digital currencies compare against more tangible physical currency such as gold and silver.
Advantages of cryptocurrencies
Cryptocurrencies certainly have a lot going for them. For one, they are currently unregulated by many governments, affording people a certain level of privacy they don’t get from regulated currencies. If you want to keep your finances away from prying eyes, then cryptocurrencies are an ideal solution.
Taking control…
They also provide customers with a greater degree of control over their finances as no financial institution or company can take control of your assets. If you use PayPal or any other electronic cash system, then that company have the power to freeze your assets at any time they want should they decide your account has been misused for any reason. With currencies like Bitcoin, you have complete control of your wallet and any coins you have stored in it.
Bitcoins
Another major benefit of Cryptocurrencies is that transactions are generally much harder to hack than other forms of online payment. This is because they use blockchain technology which is designed to discourage fraudulent activity. It is impossible to change or alter the encryption in one block without having to change every block that has been before it or come after.
Doubts and concerns about cryptocurrencies
So why do many people still have doubts about cryptocurrency? Well, the obvious problem is what happens if the user encounters some sort of problem with the technology. Digital currency isn’t tangible in the same way that gold and silver are, making it much harder to insure and if accidentally lost or stolen then it is very hard to recover your coins. There have been many instances where people’s hard-drives have crashed resulting in them losing their coins and having nothing to show for it. Transactions are also currently expensive in Bitcoin as well as the current speed of transactions being relatively slow.
An uncertain future
With technology improving every day, it is impossible to predict where we will be in the next few years and there is nothing to guarantee that cryptocurrencies won’t be replaced by something else. Gold and silver will always have a material value and have proven to be an excellent store of wealth for thousands of years. If there was ever to be a worldwide digital crash, then cryptocurrencies would be essentially worthless.
There are also a lot of people investing in cryptocurrencies that don’t completely understand what they are investing in, which is why many experts believe the market is headed for a crash. Evidence of the markets unpredictability can be seen clearly in the huge rises and drops in the value of Bitcoin over the last few years. Although gold and silver prices fluctuate they generally tend to be a lot more stable than cryptocurrencies.
Ethereum and Bitcoin
Gold and silver – ever dependable investments
People have always tended to gravitate towards gold and silver investments as an insurance against market uncertainty and a potential crisis. This is unlikely to change anytime soon. Many people still see gold and silver as the best form of protection against inflation and often purchase it as a hedge. Evidence of this can be seen in investors reaction to recent global events such as Brexit and the announcement of Trump as president when the demand for gold and silver suddenly went up overnight. In the event of a crisis, it will be much harder to get your hands on physical cash and cryptocurrency is still not readily accepted by many vendors. Therefore, it makes sense to invest at least some of your money in physical assets that are fairly liquid such as gold and silver. The fact that gold and silver are considered scarce and finite resources also mean that there will always be plenty of demand for these types of assets.
Invest in physical assets through Physical Gold
Physical Gold are specialist dealers in gold and silver. We offer a wide range of investments including gold or silver bars, bullion coins and collector’s coins. For more information on any of our stock or advice on how to invest in precious metals, why not give us a call on 020 7060 9992 or visit our contact page?
Image Sources: Antana and BTC Keychains
Timing Gold & Silver Investing
Is the time right for gold and silver investing? It’s true that, at first glance, when looking at the historical price charts for gold and silver, they can look like a bit of a rollercoaster. This might lead you to believe that gold will never reach the dizzying heights it once did.
The price of gold reached its highest point in 2012 when it soared to a record high of £1,200 per ounce. The picture for silver investing is similar to current prices much lower than at its peak. This means the current levels of both metals offers great value. No-one should want to buy at or even close to the all-time high. Current prices for gold are around 20% better value than at its height, with silver an astonishing 60% cheaper.
You can view graphs illustrating past performance over various timescales, by clicking here. They make fascinating reading, though we would always stress that they should be considered in context and not in isolation.
To learn more about gold and silver investing, download our FREE Insiders Guide now
2016 bull run
2016 saw both the gold and silver prices record around 30% gains by year-end. And although it might not yet have reached the heights of 2012, gold enjoyed a continuous upwards trend, hitting a top point of £1,050 per ounce in July of that year. In Q1, The World Gold Council reported gold demand was up 21% to 1289.8 tonnes – the second strongest quarter on record. First-half gold demand was up 18% – the second strongest on record – with gold investment accounting for almost half of that demand.
Silver also went from strength to strength, reaching its highest price since January 2015. The US Federal Reserve’s decision not to change interest rates, together with no indication as to when they might raise them, encouraged people towards investing in gold and silver.
More subdued gains in 2017
Precious metals enthusiasts saw more modest gains the following year. Starting the year at £935/oz gold finished the year around 2.5% up at £960. During those two points, it spends 3 periods north of the £1,000 mark, peaking in September at £1,030. This coincided with a strong performance in the stock markets with the FTSE 100 rising 7.5% and the Dow Jones an incredible 24%. Generally, when stock markets perform so well, gold has the least interest and its price suffers the most. So it’s encouraging in the grand scheme of a balanced portfolio that gold still returned around the inflation rate during such a period.
What can we learn from that?
This demonstrates that while gold can act as portfolio insurance during economic downturns (usually appreciating by double digits), it still can act as a store of wealth in other years too. With cash deposits still paying well below the inflation rate in 2018, this simple achievement for gold shouldn’t be sniffed at. Essentially owning gold should be a long term strategy, as returns (and potential losses) can vary greatly from year to year. Trying to second guess the market and predict the performance is futile and relying on extreme luck at best. It’s always tempting to sell everything and only buy the investment that is performing the best at that time, in a hope to ride the gravy train. However, this strategy leaves you vulnerable to being hopelessly exposed to market corrections and change. Owning some gold along with stocks, bonds, cash and property, enables balance and more predictability.
….and silver? Has Bitcoin taken its mantle?
Silver experienced a poor year in 2017 with losses of around 3.5%. Some feel the price is being manipulated downwards by the huge banks which are looking to load up on the metal. If so, the price will inevitably bounce back with a vengeance when the banks want their holdings to increase in value. An alternative is that with stocks performing well under the new Trump administration and cryptocurrencies making millionaires seemingly overnight, silver simply hasn’t had a look in. Many have switched their attention from bullion to bitcoin. With the silver price so low and its huge potential for quick gains, it’s certainly been viewed as the exciting and go-to investment for those seeking significant price rises. With the likes of Bitcoin achieving this on a steroid level, the short term greed has switched all the attention away from silver.
The likes of Ripple, Ethereum and Bitcoin have enjoyed the attention of the publicast
Will silver regain its shine instead of Cryptocurrencies?
However, as we now know in 2018, cryptocurrencies are incredibly volatile, on the downside as well as the upside. For the novice investor whose head has been turned by tales of instant wealth, there are now almost as many stories of overnight bankruptcy caused by incredible price drops for bitcoin. This period (after their initial glamorous price growth) will likely sort the wheat from the chaff. Naive investors will perhaps start to reconsider the value of cryptos, deciding either that they’ve now missed the boat, or that the risk of complete loss is too great. For the more travelled investor, they already know that investing in cryptocurrencies is similar to betting red or black in the casino. There is simply nothing tangible behind their value, and while the blockchain technology has its merits and will no doubt perform a critical role in our futures, getting rich overnight from Bitcoin could be over.
Silver to differentiate itself from Bitcoin
For savvy investors seeking large gains, they’ll know that while silver and cryptos can be grouped as higher risk, higher gain asset classes, they are almost opposites. While the likes of Bitcoin may have no tangible or intrinsic value, silver is a physical precious metal. Its value can never fall to zero like Bitcoin and its value is backed by something tangible that not only can be used as currency but also has vast industrial uses especially in the technology sector. For this reason, the investors left standing after the inevitable Bitcoin massacre will no doubt seek out silver once again as the go-to sexy investment.
Current silver and gold value represent a great opportunity and potential
2018 has started in a rather dull fashion for precious metals. Prices are still around 20% below their historical peak, so it’s still a very good time to invest in both gold and silver. It just goes to underline that it’s a lucrative opportunity, with room for growth and the possibility of sharp spikes. As of March, returns for the year have been virtually flat for gold and 7% down for silver. Combined with last year’s silver price squeeze, it’s now looking like incredible value. It’s the ratio to gold, which averages 47:1 over the past century, now stands at a staggering 80:1. Surely silver investing offers vast upside potential.
Crucially, the influential factors which tend to increase the demand for precious metals, are still very much in place. Global markets continue to be unstable, rumours of another banking crisis persist and a housing market slowdown has already started. Combine this with heightened terror threats and rising demand from Central Banks for gold, and it’s easy to understand why the precious metals market still has plenty of wind in its sails.
History tells us that stock markets are overdue a nasty correction
The calm before the stock market storm
Stock markets have now enjoyed nearly a decade of
uninterrupted growth since the 2008 credit crisis. Recently the Dow Jones has received further boosts from the Trump administration. It’s tempting to leave as much money in stocks while they’re doing well as possible. Especially while precious metals are taking a breather. However, every market analyst will agree that a simple glance at historical performance will tell us that equity market bull runs cannot and do not continue forever. More pertinently, the most severe market crashes come after the longest a strongest bull runs, which inevitably fuel an inflating bubble. This is similar to the fact that San Francisco sits plumb on the San Andreas fault line. A glance at historical earthquakes will tell us that with the constant movement of the earth’s crust, further events are not only likely but guaranteed. It’s a case of when not if there will be another huge earthquake. Not only that, but when San Francisco is overdue a quake, just like the stock markets are now overdue a correction, then the expected magnitude of that impact is far greater.
Maybe I can simply leave all my cash in stocks and switch to gold when that happens?
The best policy is not to try and predict the future, as that’s just witchcraft! Instead, we should learn from the past and understand that just like the earth, the markets are constantly moving and predicting the moment of a big eruption is impossible. We’d suggest leaving money in stocks (even after they do fall dramatically as you won’t want to miss out on the recovery, however long that takes). However, we’d also insist on owning some physical gold and silver too. The most prudent strategy with timing when to buy precious metals is simply to buy now and wait. As long as you allocate a healthy percentage of your assets into the likes of gold, then you’ll be protected when the markets do crash. My little saying is that I’d rather own gold 6 months, or even 2 years before the market crash, than a day after. Because then it would be too late.
What else could push gold and silver up this year and next?
It’s not only the stock market which is vulnerable. There’s plenty of other elements in the mix which are either brushed under the carpet by authorities or simply under-estimated.
Interest rates and housing market
After an extended period of record low-interest rates
in most of the globe’s major economies, we’re now starting to emerge into a new phase. Base rates have already risen in the UK and are predicted to continue rising in 2018 from May onwards. Rates in the US have also been rising, at a slightly faster rate. Rhetoric from central banks is that increases will be modest. However, the huge danger is the impact even small increases could have on the average man in the street. In a period of incredibly low or even negative wage growth, one of the few areas that have papered over the cracks has been property. With house prices seemingly on an unstoppable journey to the stars, the property-obsessed UK public felt comfort knowing their prize asset was at least rising in value. With interest rates near to zero, borrowing has been super cheap. So most of us have re-mortgaged, unlocking vast fortunes to fuel either extravagant lifestyles, or at least pay for the bills during lean periods. This increased leverage now leaves us vulnerable to the very interest rate rises we’re seeing now. When the starting point is as low as its been (0.25%), it only takes modest base rate increases to have a huge impact on our monthly mortgage cost, especially when cushy fixed intro rate mortgages periods come to an end. Check out our investigation into the relationship between interest rates and the price of gold and silver.
…and the housing market has softened
Not only are our monthly mortgage costs increasing, but the value of our property has stopped rising, and started to fall. This is a consequence not only of the international market struggling, with wealthy Chinese and Russians previously fuelling UK price growth, but also over the swingeing tax increases brought in by the current Government which has increased stamp duty so dramatically. We expect that firstly, more house owners will fail to pay their mortgages as interest rates rise, leading to more downward pressure on house values. For those who do manage to survive as costs increase, they will have less disposable income (with wage predictions stagnant), which will impact the high street and service sector, further crimping stock markets. Higher interest rates also mean higher new borrowing costs, which deters investment in corporate growth. All this will put even more pressure on the already unaffordable rental market. It’s common to compare gold investment versus property, but both should play crucial roles in a balanced portfolio.
A consumer credit bubble is already at bursting point
UK consumer credit bubble
With the pressures of interest rate and mortgage rises, the public’s other debts will also come under pressure. Two particular concerns are the car market and credit card sectors. Both industries are enjoying record high borrowing. However, as lenders feel the squeeze from higher rates and more defaults, we’re likely to see stricter borrowing requirements and higher rate deals. A record number of UK borrowers are currently on zero per cent credit card deals which are likely to begin to reduce in availability. People will then struggle to refinance their debt at anywhere near the levels they’ve been used to. In the automotive industry, a growing trend has been for leasing cars. Whether on outright monthly lease deals or borrowing with a balloon payment at the end, many drivers will struggle to continue financing their car. Certainly, the hunger for new cars every 2 to 3 years will likely diminish.
The technological age is slowing crushing the high street
Early 2018 has brought with it fresh casualties of the ever-growing high street demise. Toys R Us and Maplin have both gone into administration, while seemingly popular food chains, Prezzo and Jamie’s Diners are closing a large number of restaurants. Perhaps this doesn’t come as a surprise. You could argue that Maplin has always been incongruous and never really had mass appeal. While kids love the experience of Toys R Us, adults who buy the games are now far more likely to order from Amazon and benefit from lower prices and next day delivery. Either way, this trend of weeding out the weak, however large the company, is likely to continue as the public turn their back on the high street and embrace online shopping. The frightening consequence is the sheer loss of long term jobs. Automation is filling the role of so many which will have a long term negative impact on an already growing population. Read our blog on the future of gold in a cashless society.
Brexit, Trump and Russia
There isn’t enough time to cover every simmering possible global issue which could push gold and silver prices skywards. But certainly, a handful of other significant issues would be the ongoing threat to the UK from Brexit. Whether this has a direct impact on our economy, a slower longer-term influence or is simply negative to Sterling, this is one which will stay on the radar for a while to come.
Donald Trump hasn’t blown up the world yet, but who knows about tomorrow! None of us would be shocked if he develops his trade war with China, instigates a war with the likes of North Korea, or simply makes some terrible domestic decisions in the world’s biggest economy. Either way, in today’s ultra globalised economy, foreign issues have more impact on the UK than ever.
The recent tensions between Russia and the UK after the poisoning accusations could be a storm in a teacup. However, the Government’s strong condemnation of Russia suggests there could be a hidden agenda. With Putin now flexing his muscles, I’d rather own gold right now to provide diversification, just in case this escalates (especially as Russia have been stockpiling gold aggressively themselves over the past few years).
Long term view for gold and silver investing
The value of gold and silver may be volatile, but owning them as part of a portfolio reduces your overall personal volatility. They tend to act as a balance to the traditional paper assets (like stocks and shares), so when those markets fall, physical gold and silver have historically risen. The motivation for many gold & silver investors aren’t necessarily to time the market perfectly; instead, it’s to take a long term view to provide balance and protection to their overall wealth. This way, exact timing isn’t important, as the long-term hold should outperform any short-term price drops and still deliver portfolio insurance.
So there’s no need to worry that gold prices might appear to plateau from time to time. You should consider investing in both gold and silver, which remain very worthwhile, solid, tangible investments.
Cost average to iron out volatility
If you’re still unsure and concerned about timing, then our ‘Monthly Saver’ enables you to purchase regularly. You can set up to automatically buy a small quantity of gold or silver every month. This means that if the price does decrease from one month to the next, it benefits you, as your next purchase would be at a lower rate.
Over time, you buy each month at the various underlying prices, therefore averaging out the cost of your precious metals. It’s a great way to get started in gold and silver investing.
The main message is that it’s necessary to take the long-term view. As with any investment, prices will go up and down, but as these graphs illustrate, the rewards can be well worth it. If you’d like to find out more about this type of investment, why not Download our free guide to investing in gold and silver. We maintain gold and silver are still very good value and worth their weight in, well… gold and silver!
Buying precious metals can be a tricky business. Many investors are keen to see, touch and feel their bullion when they buy. They are able to go locally to a dealer and complete their transaction in person. However, as the world moves to online buying and selling, the precious metals market has not fallen behind on this trend. Increasingly, investors are looking to buy their silver online and they choose to store their bullion in secure storage offered by the dealer or accept the delivery at their address. Needless to say, buying anything of value online carries certain risks, although there are certain advantages as well. So, we decided to bring the subject under a scanner and take a long hard look at the pros and cons of buying your silver online.
Always check the dealer’s reputation when buying silver online
Pros
1. Convenience
When you buy your silver online, there are many online dealers to choose from. This long list includes highly reputed mints, like the Royal Mint, where the silver coins (such as silver Britannias) are struck. While many choices can be confusing, one of the biggest advantages of going online today is that all dealers have a digital footprint. With a little bit of time invested in research, you can check the reputation of online traders via the internet.
Check out popular aggregators like comparesilverprices.com or UK Bullion. While you’re doing your research online, don’t forget to check out www.physicalgold.com. We don’t just sell gold (like gold coins and gold bars), we also have some great deals on silver, particularly for silver bars (like 1KG bars) and bulk deals. An online reputation audit goes a long way in identifying a reliable online silver dealer. You can check out ratings given by other investors simply by checking out the dealer on google reviews. If the dealer is dodgy, there’s bound to be some bad reviews by customers. Don’t forget to check out other important things like whether the online dealer offers an authenticity certificate. At www.physicalgold.com, we certainly do.
2. You pay less and have access to a wider selection
Most online dealers charge lower prices, as they do not pay for salaries of shop attendants, shop rent and utilities like energy bills, various overhead costs, etc. Many online dealers will also cut you a deal where shipping may be free. You would also benefit from a greater selection of products as online sellers are not limited by physical space for storing inventory.
3. You benefit from greater privacy
When you buy your bullion from a brick and mortar store, you are not anonymous. The very fact that you walk out of the store with valuables on you could mean that you become a potential target for theft. When you buy online, your data may be more secure. With the new online privacy laws like GDPR, companies need to comply with data privacy regulations that ensure your personal data remains safe. Here at Physical Gold, we’ve long been a member of the Government’s Information Commissioner’s Office (ICO) which sets up a framework for privacy and data.
4. Tracking payments
When you buy online using a debit or credit card, an automatic record of your transaction is generated. In the event of any post-sale issues, the dealer cannot deny that the transaction took place.
Knowing the pros and cons of silver storage helps you make a better decision
Cons
1. You cannot examine the product you’re buying
When buying your silver online, you do not have an opportunity to physically see, touch and feel what you’re buying or meet face to face with the dealer and identify the business premises. You are totally reliant on the reputation of the dealer, which is why it’s important to research the dealer before buying and trade only with reputed and verified dealers.
2. Your silver could be stored in a location out of your control
You can choose to accept your silver at your home or opt
for the dealer to store the bullion at a secure location under their control. If you do that, you do not have physical access to your bullion and cannot see or inspect what you have bought. Delivery at home may incur charges, which may include the cost of insurance. These costs may be unrecoverable if there is a problem with the product.
3. Your payment details could be compromised
When you conduct a transaction via the internet, your credit or debit card details may be visible to hackers who may steal your financial information. Credit card fraud is now increasingly common, and you are not exposed to this risk when you pay for your silver bullion in cash when buying face to face.
4. You could even lose your money
If you are unlucky enough to pick a rogue dealer or buy products from an unverified online seller, you could lose all your money once you have transferred it online. This is why verifying the business location and checking the products in person is often a better solution.
Talk to our silver experts before you buy
Call Physical Gold Limited on 020 7060 9992 or email us to speak with one of our silver buying experts before making your purchase. They are waiting for your call and can guide you on what to look out for when buying your silver online.
Image credits: Pixabay and KMR Photography
Wholesale buying creates pricing advantages due to economies of scale. This simply means that when a buyer buys anything in bulk, he gains substantial discounts from the wholesaler. Assuming that the buyer is a retailer, there is a legitimate expectation of profit when he prices the same commodity at market price and sells his stock. Well, precious metals are no different and the same rule applies to the bulk-buying of silver bullion.
Why buy silver in bulk?
But, who would buy silver in bulk? Surely very large quantities are required to be bought and significant capital deployed for the purchase? This is indeed the barrier to buying precious metals wholesale. A substantial investment is required to complete the trade, which deters most private individuals from pursuing such deals.
Download the free silver buying cheatsheet to get all the insider’s tips
Key challenges
Moreover, there is the problem of storing large quantities of precious metals in your home or at a secure facility, arranging secure transportation to move your purchase and lastly, the paperwork required to buy wholesale. However, if you could manage all that, you could have a significant advantage in building an impressive silver portfolio, with far lesser capital outlay, when compared to retail buyers.
Provided you have the capital to do this, you could invest the money required to buy 20,000 ounces and perhaps acquire 28,000 oz. of silver, to sell later if prices were to rise or simply hold it long term as an investment for your retirement. However, please remember that such a purchase at today’s prices of around $16 an ounce would set you back $448,000.
Silver bars are heavy when bought in bulk and require adequate transportation
Ways to buy silver in bulk
If you don’t have the required capital to make such a large investment, one of the ways to do it is to team up with your friends to form a pool of investors who can invest their resources to build a sum good enough for a large investment. However, do bear in mind that the formation of such an investment club will require quite a bit of legal paperwork to ensure that each investor is clear about what he/she receives. You would also need to be sure that all the investors are reliable people who can be trusted.
How else can I buy silver in large quantities?
Another idea is to purchase silver futures on the commodity market. The futures market usually operates in a speculative manner, where investors simply sell off their holdings when prices move up. They do not expect to take delivery of the metal or wait until the maturity date of the contract. However, if you were to buy these futures and take physical delivery of your silver when the contract reaches completion, you could be buying at wholesale rates. Of course, you would need to keep playing the market, and over time, you could have a sizable amount of the precious metal.
Many investors who wish to buy wholesale silver, actually get registered as a precious metals wholesaler and open a company along with a company bank account, etc. However, this approach could take months and a whole lot of paperwork before you can get started. You would also need to report earnings, taxes, and comply with regulations pertaining to the industry as well as companies house compliance procedures in the UK.
Silver coins are a popular bulk purchase, as they require less storage space
Identifying wholesalers
Nevertheless, whichever route you choose to buy your silver in bulk, you will need to identify wholesalers who will sell you the metal in large quantities. Of course, the silver coins and silver bars are manufactured by reputed mints across the world. So, you could try getting in touch with them in the first instance. But, do bear in mind that many mints would only do business with you if you were a registered numismatic or precious metals trader or a financial institution registered with the FSA. In order to qualify, most companies require to show trading records over a number of years. So, this may not work too well for you if you are just starting out in the wholesale business.
Contact us to buy wholesale silver
At Physical Gold, there are wholesale buying options in the online store that you can certainly explore. You would not be required to have a whole lot of paperwork in place to avail of our bulk buying option for silver.
All you need to do is simply register yourself through our online account opening process. When you select the amount of silver you want to buy, you will see that we have an option for you to select large quantities within the dropdown menu itself. You would also notice that the larger the quantity of your purchase, the more substantial the discount. For example, you could save £2,219 if you were to buy 100 silver bars, weighing a kilo each.
Call us on 020 7060 9992 or email us with your wholesale requirements and an investment expert from our team would be happy to contact you and discuss your requirements. We also sell gold wholesale too.
Image credits: Sprott Money and Fu Fu Wolf
Whether you’re a serious or hobby numismatist, or an investor looking to build your wealth, silver coins can be a great investment. Currently, market analysts have become increasingly bullish on silver as an investment option and the future looks bright for the precious metal. Interestingly, silver investment with its significantly lower price parity when compared to gold, offers investors a great gateway to building a precious metals portfolio at a fraction of the price of gold.
Download the FREE Silver coin Investment Guide now
Can silver be supplied VAT free?
For many years, Physical Gold Limited supplied VAT free. Due to an EU Treaty, this was legal and possible, but sadly Brexit brought this to an end and VAT free silver is no longer a possibility.
Brexit ended VAT free silver, but thankfully we are still able to sell popular silver coins and bars at all-in competitive prices. This is enabled due to:
- Free delivery – we are now shipping silver directly from the UK, this means we can provide silver with free delivery (this was not previously possible).
- Reduced product range – additionally, we decided to reduce the number of silver products we offered. Although, this may be worse for choice, it means we can bulk-buy the products we choose and negotiate much better prices – this discount is passed on directly to you!
Silver great for balance and protection
Savvy investors always turn to precious metals in order to hedge their risks and silver is an excellent choice for this purpose. In fact, historically, silver has always been a popular choice for coinage across the world.
Examining the accuracy of ridges on the sides of a silver coin can establish its authenticity
Why is silver used to make coins?
Silver is a popular metal for coinage, owing to its fungibility. Fungibility is the property of any commodity, where similar amounts of the commodity can be traded for each other, irrespective of its shape, size or form. If the value of both the traded items remains constant, the commodity is said to be fungible. In this case, 500 grams of silver can be simply exchanged for another 500 grams of the metal, in the form of bars, coins or any other form. Since the value of silver is calculated by the spot price per troy ounce, the two tradable items are considered to be interchangeable.
Apart from this, the other reasons for the popularity of silver for coinage are that silver is compact, easy to store and move and its density ensures that small quantities of the metal have high value. It is very durable and does not corrode easily. In addition to these factors, the metal is easily transformed from bars to coins and vice versa, through melting.
Silver coins are a popular investment option since storage is easy owing to their size. Like all other coins of numismatic or bullion value, they come packaged in their slabs. Buyers should always check that the slabs are intact at the time of delivery. Not only does this indicate that the coins have not been tampered with, but they also need to remain in their packaging in order to retain their value. Coins removed from their slabs can fetch a lower resale price, and it’s important to know this before investing in silver. As a silver buyer, it’s important for you to know certain facts about investing in silver coins before making your purchase.
Sets are popular with numismatists. Here is a set of 1oz Libertad de Plata from Mexico
Checking authenticity
Upon receiving your silver coins from your dealer or the mint, you need to first establish the authenticity of the coins. Of course, if it’s arrived along with a certificate from a reputed dealer, and you’ve already verified the seller, simply retain the coins in their packaging. But let’s assume you’ve bought them at an auction. Then, you need to ensure that the coins are legit. There are many ways to do this. There is a device called the Fisch tester which ascertains the actual age of the coins by testing them. These tests are based on weight and dimensions. An alternate method is to check the conductivity factor. As silver is a great conductor of heat, placing an ice cube on a coin will likely see the coin melting fast as the heat is transmitted to the coin.
Buying silver coins from Physical Gold
The process of buying silver coins from Physical Gold couldn’t be easier. All you need to do is open an account online. Next, you need to browse through the site and add the silver coins (such as Britannias) of your choice to your basket. Once you’re done, you can simply check out using your credit or debit card. Your transaction is protected by our 3D secure authentication process.
Remember, coins and bars cannot be clubbed together, and you will need to purchase them separately, although you can speak to us about pricing for bulk purchases. Your coins will then reach your address via a courier service that is completely insured to protect your investment. If you need guidance at any point in time, all you need to do is call us on 020 7060 9992 or email us. A member of our helpful team will be in touch with you right away. Happy investing!
Image credits: Eric Golub and Christian Fausto Bernal
Investors who buy precious metals have an affinity for gold, but often prefer to diversify their portfolio by buying silver bullion in the form of bars and coins. Silver is gaining ground as an investible asset class. There are a few reasons for this. Currently, the price of gold is almost eighty times higher than the spot price of silver. Investors see this as an opportunity to get more bang for their buck, as they can purchase a lot more silver for the same amount of money that they would have spent for gold, whether it be gold bars or gold coins.
Read our FREE 7 considerations cheat sheet before you buy silver bullion
Silver on the rise….
Earlier, investors seemed a tad bearish about silver, as the prices never rose as per their expectations. However, that may well change this year as investment analysts believe that silver may well attain $20 per ounce. The current price is around $16 an ounce. This belief is based on the fact that industrial demand for silver is likely to soar, as silver is a much in demand commodity as a conductor of electricity. Innovations we are likely to see in the near future, including electric cars, solar technology and the increasing volumes of IT equipment. Mine production of the precious metal has collapsed as resources are fast diminishing, impacting supply. Many of these factors seem to be the reason for investors to turn bullish on silver.
So, how can you buy silver bullion and how do ensure its genuineness and who should you go to? Firstly, you need to know about the bullion you are buying.
Silver bars are an equally preferred form of silver bullion as coins
Buying silver bullion
Of course, one of the surest ways to ensure peace of mind when buying bullion is to purchase it from a reliable dealer. If you’re unsure about your dealer’s reputation, call us to speak to one of our investment advisors. The first port of call when checking the authenticity of silver bars is mintmarks. Every silver bar would have its mintmark, the mark imprinted by the producer. Go through the mark carefully, comparing with images of similar marks from the same producer. Check details like fonts, designs, etc. If any element or part of the mark isn’t there, it’s cause for concern. If there are no markings, it could well be that the bar is counterfeit. The markings on the bar should also denote the weight of the bar, its purity and its serial no. When checking coins, be sure to check for the mintage year as well as the denomination.
Identifying genuine silver coins
Bars are fairly standard, however, coins have designs and sizes that are hard to copy. The edge finish of coins was developed to prevent counterfeiting. Coins have different types of edges, depending on the design. These range from smooth, letterings, ridges, reeds, etc. If the coin is a fake, chances are that it will have poor workmanship, as forgers rarely invest in the kind of expensive infrastructure owned and operated by the top Mints in the world.
Devil’s in the detail
Another point to note is that silver is a dense metal. If another metal has been used to make the silver coin, the size wouldn’t be right. Referencing the exact weight and size is an important exercise when investing in bullion. This helps you to check the data when you measure and check the coins after they arrive. All it takes is some inexpensive equipment like a set of Vernier callipers and a jeweller’s scale. There’s even a device called a Fisch tester that measures and weighs your coins for genuineness.
Knowing your silver bullion is really important before you buy
Conductivity test
Here’s a test that works mainly for silver bullion. Silver is a highly conductive metal and transmits heat very easily. In order to test your coin to see if it’s genuine, place a cube of ice on your coin. The coin will start transmitting heat to the ice cube instantly and this will be visible as the ice will start to melt. In the event of a slow melting or no reaction at all, the coin is most likely a fake. Silver bullion may also be tested using an acid test kit. The acid should be applied to a very small area, almost like a dot. A change of colour to red, brown or green confirms that the bullion is genuine.
Call us to buy genuine silver
When you buy from www.physicalgold.com, you can rest assured that the bullion is 100% genuine silver. We are London-based and certify each and every silver bar or coin (such as silver Britannias) that we sell. We don’t just sell bullion, we advise our clients on the right strategy to buy precious metals to maximise returns on investment. Our advice covers every aspect of your purchase, including when you should buy, how much (including bulk buying) and for how long you should hold your investment.
Of course, the return you can make on your purchase depends on international prices of silver and which the market moves. Nevertheless, by speaking to our UK-based investment advisors you are likely to get sound advice that’s based on solid research and knowledge. So, call us right away on 020 7060 9992 or email us and one of our silver experts will be in touch with you right away to discuss your requirements.
Image credits: Saga Sarkar and Pixabay
What is GDPR?
From the 25th May 2018, a new EU privacy law will commence. This regulation will be called the General Data Protection Regulation (GDPR). The regulation will be put in place across the EU and EEA region and will be applicable to any company that sells to European citizens. Many of these companies, including those based in other parts of the world also store data relating to European consumers. Now, for the first time, these citizens will have greater control over how their personal data can be used, stored and protected.
For purposes of regulation, personal data means all names, images of persons, email addresses, bank details, postal addresses and even computer IP addresses. The regulation seeks to protect data about people irrespective of where they work. For example, the law recognises that people working in companies are people too and their data needs to be protected. Companies cannot refuse to comply with the pretext that when employees are at work, they are not in their personal space and therefore have no right to privacy. Needless to say, there are tons of work that companies need to do in order to be compliant and avoid hefty fines
Entitlements of customers and employees
Every individual will have the right to access their personal data. This means that customers can always ask to see what data a company holds about them and also have the right to know how that data is being used. Companies will need to inform the customers that their data is being recorded and must provide them with a copy of all personal data, free of cost, on demand.
Customers will also have the right to data portability. This means that customers can ask for data to be transferred from one company to another when changing service providers. Interestingly, once they cease to be customers, they can also request to be forgotten and the company will require erasing their data already. Companies will also be required to notify a customer immediately if their data has been compromised, within 72 hours of a breach. There will be other rights as well, such as the right to stop their data from being processed and correct the information if required.
With the introduction of GDPR, the rules of engagement for the industry will change
What does it mean for the gold and silver industry?
Online gold and silver dealers need to put in place several initiatives in order to comply with the new regulations. Firstly, they need to map all the personal data relating to their customers held on their systems. This includes setting access levels and conducting a risk audit. The next step involves cleaning out all unnecessary data to avoid the risk of non-compliance. Here at Physical Gold, we’ve long been a member and adhered to the Information Commissioner’s Office guidelines, so GDPR isn’t a huge adjustment.
Dealers of precious metals will also need to invest in robust security systems to ensure that they are well protected against hackers or any possible breach. Lastly, they will need to put in place processes that clearly demarcate the data that needs to be stored as per customer approvals. Handling of data is likely to be a big challenge and simply implementing processes will not be enough. Staff need to be trained on how to handle data and maintain transparency with customers at all times. This could also include timely notification of any breach and disclosure to customers about their data held on file by the dealers.
Find out more about how GDPR affects your rights as a customer
Our industry experts are able to guide you on the impact of GDPR on the precious metals industry and how you can protect your data under the new laws. Call us on 020 7060 9992 or email us with your concerns and our experts will be happy to get in touch.
Image credits: Convert GDPR