When you are investing in silver bars there is a plethora of information that you should know before you ever spend even a penny. One of the most vital pieces of information, especially for online buyers, is that you must know the difference between new silver bars and secondhand bars.
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By mistaking one for the other you will likely end up spending far more money than you should and in turn find it extremely difficult to make any amount of money on your investment. In the following few sections you will be briefed on what exactly differentiates new silver bars from secondhand ones and how you can tell the difference, even if you are shopping on the internet.
Why it Matters
Speaking loosely, a one ounce silver bar is a one ounce silver bar regardless of when it was made or who made it; new or old they can be used for investments. The reason whether the bar is new or secondhand matters is because a silver bar in mint condition is more valuable than one that shows visible signs of wear and tear.
In precious metals the bottom line always comes down to the condition of the bullion product in question. While the scrutiny for quality is much more in-depth when talking about silver coins, the condition a bar is in most definitely has an affect on how much you are going to end up paying for the silver bar.
Benefits of New Bars
A Brand New 1 oz Silver Bar from Sunshine Minting
Now that you understand that there is a difference between new and secondhand bars, we can begin discussing the benefits and reasons behind why you would purchase new bars.
When investing in silver or any other precious metal, the quality of the item you purchase is one of the most important factors that you should pay attention to. When you invest in new bars, and only new bars, you will have no problem being able to turn right back around and sell your silver in hopes of a positive return on your money.
On the other hand, the market for secondhand silver bars is much smaller and while gaining a positive return on an investment in secondhand silver is very much feasible, it will not come without its challenges.
New silver bars are packaged in protected plastic sleeves and sometimes even in plastic cases, the bars are free from scratches and essentially all signs of wear and tear. The same cannot be said about secondhand silver bars that are typically worn and tattered from their many years of changing hands.
An investor who primarily invests in new silver bars will be able to sell more of their bars faster than an investor who has the same quantity of secondhand silver bars. On top of it all, the investor who chooses to seek out new bars will also be able to sell his investment for much more cash than one who is ok with hanging on to secondhand bars.
Benefits of Secondhand Bars
A Secondhand 100 oz Engelhard Bar
After reading the last section you may be under the impression that there are very few benefits to owning and purchasing secondhand silver bars but that thought could not be further from the truth. In fact, secondhand silver bars can be used as an investment vehicle just like new bars can.
The reason one may choose to acquire secondhand silver bars is because they are more cost effective than new bars. More often than not secondhand bars are sold at a price that is much closer to spot value than new bars.
New bars can be sold for as many as $5 above spot value while secondhand bars are typically sold at or only very slightly above spot value. This means that making a secondhand silver bar investment may be able to cost you less while still earning you a decent return.
Please note that some brands, like the Engelhard pictured above, will command a premium even if the bar is secondhand, simply due to the collectible value of a brand like Engelhard.