Gold and Silver
August 1, 2022
Check back weekly as we post short videos as a way to delve deeper into our Power Hour. This week – we turn our focus to Gold and Silver! Don’t forget to tune in for our Power Hour on Friday August 5th as we discuss Universal Family Office.
Physical Coins vs Gold ETFs
Owning an ETF inside your portfolio definitely has a place and can be used as a risk management tool, many of our portfolios have gold and silver ETFs, especially now.
However, this is just paper markets and what happens can definitely affect the price of those ETFs as well.
On the contrary, owning the physical coins means you have possession and possession is kind of nine-tenths of the law. They’re not going to change the value as the paper market can.
Plus, they’re not reportable. It’s not tied to your social security number, it’s not on any report. If you sell them later, there’s no 1099.
There was a study done by CPM group looking at how owning gold and silver affects your portfolio. It showed owning any amount of gold and silver increases your portfolio’s performance, but having between 10 and 20% also decreased the risk.
When you’re trying to track the physical coins, it becomes a little harder as they are not going to show up in your statement. However, in the long run, it helps because it always keeps that steady growth.
Spot Price is the cost for gold and silver that’s still in the ground, which can be very volatile, but the physical coins themselves tend to steadily increase over time. One of the easiest ways to track this is to ask us once a year or so what the value is and track that over time.
Investing in Gold and Silver vs Collecting
Gold and silver value is measured in ounces, it doesn’t matter if it’s in a necklace, or a coin, the value of ounces is the same.
You often hear people selling these collectible silver coins for a crazy high price. The ounces aren’t valued at more, it is a collectible, but to get that same value out of it, you must find another collector who is willing to pay that value. (The value of the paper a baseball card is printed on is the same, the value because of what someone else is willing to pay).
The value based on ounces for the coin is now about $39, so they’re trying to sell it for $1000, then know that’s a collectible price.
It’s important to know the difference between investing vs collecting. If your intent is to collect, that’s fine, but know that the value you’re paying for a collectible coin is not that silver isn’t worth any more than the other silver is. It’s just you’re playing for the collectible items.
We work with National Gold Consultants as they have taken all the steps to take and show that they’re working as fiduciaries. They only work through advisors because they want to make sure it’s part of your overall plan. They’ve been tested in their process and work with those who want to invest and buy wealth insurance.
We serve clients in Mineral Point WI, Dodgeville WI, Platteville WI, Lancaster WI, Fennimore WI, Boscobel WI, Richland Center WI, Muscoda WI, Spring Green WI, Mazomanie WI, Sauk City WI, Middleton WI, Madison WI, Fitchburg WI, Verona WI, Mount Horeb WI, Barneveld WI, New Glarus WI, Monroe WI, Belleville WI, Oregon WI, Stoughton WI, Darlington WI, Cuba City WI, Hazel Green WI, Belmont WI, Dubuque IA, Freeport IL
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