Best way to invest in gold and silver?

Hi,

I'm looking to invest in gold or silver. Which is considered a better investment? And what's the best way to buy and sell? Via my local bank in Canada?

Today silver is priced at $17 USD / oz and gold $1093 USD / oz...is this considered a time to buy or is the price too high?

If there are any precious metals investors that can provide me with any advice and/or tips I would be most appreciative. Thank you, Claudia

Do you want to actually have it in hand or have it on paper?

There are others on here who will know more about this than me but I will try to answer part of you post. Gold is currently out of my price range so I have not looked into it very much. The research I have done was on silver so that is all I will comment on.

There are basically two ways to invest in silver, you can buy silver certificates or the real stuff. At the time, silver certificates seemed to be more like playing the stock market than actually buying silver. I felt that owning the silver outright was the best for me so that is what I have been doing. It is actually kind of easy to buy. At least in this area. Just go to a coin shop where old and rare coins can be found. Most of them will have silver or know where to find it.

What you want to buy is called silver bullion or silver rounds. You will need to check a couple of things. First check that what you are about to buy is pure silver. The purest you can get is .999% pure silver and each piece of bullion or round will be marked. The second thing you want to look for is that the piece is 1 Troy ounce. Again it will be marked. You don't want anything less that .999% silver and 1 troy ounce in each piece. The silver can be bought several different sizes, 1 ounce, 10 ounces, 100 ounce bars ect and in different shapes and designs stamped into the silver. None of that other stuff matters as long as it is .999% pure and at least 1 troy ounce.

A couple of web sites I have found useful are goldsilver.com which gives the current price of each precious metal along with informative articles. Another one is kitco.com which also has useful articles and metals prices.

most convenient way by far is picking up a gold/silver etf. most popular ones are GLD for gold or SLV for silver both listed on the nyse.

I would stay away from the ETFs; its good to have "real money" that is out of the financial markets... Basically you want to hold some physical bullion; I personally hold around 12% of my networth in Bullion; thats something to consider for your personal needs. Remember certificates are also no good; if you buy you should buy the phyical bullion...

Anyways; is gold over priced right now ?? I would suggest doing research comparing gold and other financial instruments...

For Example how many units of the Dow can be bought with the current price of gold etc... I think its around 9 Ounces of gold... It used to cost 45 ounces of gold to buy a unit of the Dow years back prior to the nasdaq bubble I believe.. Just something to look into...

As a Canadian myself; I am not sure if gold is the place to be getting into now.. I bought some years back and have no plans on purchasing at these prices. I am not an expert though... I do have to holdings in physical silver bullion though... What I like about silver is that its real money and if there is ever a major currency crises; then I will have a portion of my wealth in something other than paper... Withregards to silver; since its a dual precious metal/ industrial metal it might be benefical to look at the future economic growth of both china and india.... My also dont look at my silver holding on a day to day and see am I up am I down; its more of an insurance policy type deal and its working well that way.... Dont forget to try to buy when the Canadian dollar is up as much as possible...

cheers

Another website for silver bullion purchase:
www.firstmajestic.com

IMHO Gold is pretty high, I don't think you have a chance to make a lot of money on gold right now.

But silver is undervalued, and I wouldn't be surprised to double my money on such an investment.

Silver Bars, Silver Coins, Gold Coins and Bars, Palladium and Platinum Bullion Available to Buy

Stagecoach Silver Bullion from Northwest Territorial Mint

These would be a fun way to buy silver. I'm quite tempted to pick up 1k or so of them.

I have purchased from the North West Territorial Mint previously; nothing but good news.

I would just call a few local coin shops and then go down and purchase some coins. No real need to pay for shipping if they are avaialble locally for the same price.

The central gold trust is a closed end fund that trades on both the TSX(Canada) and the AMEX(US). It holds both physical and certificates for gold but is mostly physical. The good thing about a closed end fund is that they can trade above or below the net asset value of the assets. Currently the fund trades at about a 5% premium.

Another closed end fund you may be interested in is the Central Fund Of Canada which trades is both the States and in Canada also but holds both Gold(54.3%) and silver(43.3%) bullion. This one trades at a premium also of about 9% mostly due to silver being more volatile then gold. You can use both of these closed end funds to measure the sentiment (premium/discount to NAV) for precious metals they rarely trade at a discount.

ETf's for Gold(GLD) and Silver(SLV) are also an option and will trade closer to the spot price they also track the bullion well. I am not sure if there are Canadian equivalents for these but I am sure there are. I would avoid any Horizon Betapro etfs in Canada as they overcharge on fees and are a joke in general. Before you buy a commodity ETF make sure it holds the physical commodity. Stay away from commodity ETFs that track futures markets they are only good for trading not for long to medium term investing

Buying physical gold and silver is also an option, I prefer bars to coins because they have no numismatic value. Just make sure the premium you pay is not too high. I have no problem holding shares of a gold fund as I think they are very safe.

And the more risky way to own gold/silver is to buy shares in mining companies. These may not track bullion prices that well but can offer substantial upside if a major find is discovered. Of course this becomes a specialized area of investment if you are looking for the next great gold mine and at these prices gold and silver companies are less leveraged to the spot market then they were at lower values.

As for is it a good time to buy gold, your guess is as good as mine. For trading this market I have had the best success buying weakness and not strength. But If you are looking at investing in terms of a long term holding in a portfolio you need to consider what you expect in the future. Gold prices are effected buy demand for jewelry, central bank holdings, and protection from a weakening dollar. Inflation is also seen as a reason to buy gold but I do not know if that will push it up higher here if the US dollar does not continue to fall. Fear is also seen as a reason to own gold but not when it is liquidity based fear because it is a fairly liquid market it gets sold first. Becareful reading gold investing articles on the net lots of crazy gold bugs out there.

The thing that has stopped me from buying gold or silver is that I'd be using Aussie dollars to buy something that's priced in US dollars.

If I were to buy silver or gold it would definitely be the physical stuff.