If you like the idea of owning silver as an investment -- but don't relish the thought of lugging home bars of it and packing it away in a safe -- there are other ways to invest in the shiny metal. The easiest way is to buy silver in the stock market. If you have an online brokerage account, you can do so with the click of your mouse.
Research the sub-sector of exchange traded funds that invest in silver bullion. As of October 2012, the silver bullion ETF category held two funds. The shares of both funds are backed by silver in storage and have share prices roughly near the price of an ounce of silver. Make a note of the stock symbols for the funds.
Review the selected ETF price chart to determine if now is the time to enter the market for silver or if you should wait for a lower priced entry point. When to start an investment is a personal decision. But if you own stocks, some of the same evaluation of price trends can be applied to the silver ETF share values.
Purchase shares of a silver ETF in the same manner as you would purchase stock shares. Enter the stock symbol for the fund and the number of shares you want to purchase using your brokerage account online trade screen. During market hours your order should be completed almost immediately and the silver shares will show on your account summary screen.
- As a bullion backed investment, a silver ETF will pay no dividends. Your profit or loss on the investment depends on what happens to the price of silver.
- You pay a regular stock commission to buy silver ETF shares. The transaction costs of this path to invest in silver will be significantly less than buying silver bars from a local dealer and storing them in the closet.
- Another way to invest in silver is to buy shares of silver mining companies. These stocks should be evaluated both on business results and the expected price of silver.
Tim Plaehn has been writing financial, investment and trading articles and blogs since 2007. His work has appeared online at Seeking Alpha, Marketwatch.com and various other websites. Plaehn has a bachelor's degree in mathematics from the U.S. Air Force Academy.