View
28
Download
1
Category
Preview:
DESCRIPTION
Top 5 Reasons to Invest In SilverSilver: Paper VS PhysicalHow to Buy Silver BarsHow to Buy Silver BarsHow to Store Silver at Home
Citation preview
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 2
Table of Contents
About The Authors 3
About This Starter Kit
4
Top 5 Reasons to Invest In Silver
5
Silver: Paper VS Physical
14
How to Buy Silver Bars
16
How to Buy Silver Bars
18
How to Store Silver at Home
20
About Us
21
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 3
About the Authors
JONATHAN QUEK
Jonathan Quek is the author of the best-selling book ‘Why Gold?
Why Silver? Why Now?’ He had the privilege of interacting with
gold and silver experts such as Jim Rogers (Author of Hot
Commodities), James Turk (Founder of GoldMoney.com), Shaykh
Umar Vadillo (Founder of World Islamic Mint), Richard Duncan
(Author of The New Depression) and Peter Hug (Director of Kitco
Metals).
Jonathan is the founder of SilverMalaysia.com, an online gold and
silver education company that provides retails of physical silver at
competitive price. Jonathan has been featured and interviewed in numerous media
channels such as BFM89.9, TV1, TV2, TV3, Capital TV, China Press, New Straits Times, The
Malay Mail, just to mention a few.
An ambitious visionary with vast financial and investment knowledge, he holds a keen sense
to educate the public on investments, thus he has been invited as an esteemed guest
speaker to several events throughout his mission which includes Bank Negara & AKPK’s
POWER! Programme, CPA Australia, CIMA, University Malaya, Taylors’ University,
iCapital.biz Berhad Open Day 2011, MSI Summit 2011, Wealth Expo, and many more.
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 4
About This Starter Kit
When SilverMalaysia.com started in Year 2010, many questions were raised on why we
regarded silver as the new gold. We believe that the largest global financial crisis in history is
ahead of us as a direct result of the mass printing of the U.S. Government. At the same time,
we believe that the greatest investment opportunity in history is knocking on our door as
well. And like it or not, everyone needs at least few silver bullions in their hands.
A young student or fresh graduate can stop drinking a few cups of Starbucks or ChaTime. By
then they can save around RM100++, and thus they can start getting into the silver game.
All parents love their children and want the best for them then they should buy silver for
their child's future education. Because like it or not, silver is a better bet for a long term
child education plan.
A high paying executive or entrepreneur with a higher income will need to diversify his or
her investments. Hence, Silver is a must-have in every investment portfolio.
For an older couple, retirement is probably the main thing on their minds. If hyperinflation
were to take place, it would be disastrous if they do not have any gold and silver on hand.
From these examples, we can see that everyone needs some form of silver bullions. Many
hesitate because they do not understand the need and the process. Therefore, we have
come together to create the 'Silver Investors Starter Kit' to help those who are new to the
world of investing in silver.
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 5
Reason #1 Gold Silver Ratio
The formula that is often used in allocating precious metals investments between gold and
silver is the Gold Silver Ratio. This simply means how many ounces of silver it takes to buy
one ounce of gold. The ratio is determined by dividing the price of gold by the price of silver.
Example
If gold was $1,000 an ounce and silver was $20 an ounce, the ratio would be 50 to 1.
The gold price at 50 times the price of silver.
The Gold Silver Ratio varies by region and time period.
In China, during the Ming Dynasty, the Gold Silver Ratio was 4 to 1. This means that you can
exchange 4 ounces of silver to 1 ounce of gold.
In ancient Egypt, the Gold Silver Ratio was 1 to 1. This means that silver has the same value
as gold.
According to Islamic Law, Umar Ibn al-Khattab established the known standard relationship
between gold and silver based on their weights: "7 dinars must be equivalent to 10 dirhams"
which means 7 gold must be equivalent to 10 silver.
For the first 2,000 years, the average Gold Silver Ratio has been about 12 to 1.
Please take note that the Gold Silver Ratio cannot tell you whether the price of gold or silver
is going to go up or down, the ratio can be a useful indicator of whether one metal is
undervalued relatively to the other. In the year 1980, silver’s price increased to $50 while
gold moved to $850, the ratio moved briefly moved below 15 to 1 and at the top of the
market produced a Gold Silver Ratio of 17 to 1. Silver was clearly ahead of itself relative to
gold.
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 6
Reflecting the current industrial orientation of the silver market, silver prices fell sharply as
the recession and credit crisis developed in 2008. The ratio was 85 to 1 and silver was
obviously cheap relative to the gold price, and that was the year when Robert Kiyosaki, the
author of Rich Dad Poor Dad and Conspiracy of the Rich was announcing in his Youtube
videos that everyone out there should be buying silver.
If gold soars to at least $2,500—as industry experts like UBS, Peter Schiff and James Dines all
believe—silver could rise to $156!
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 7
Reason #2 Industrial Demand
With the growing wealth in Asian regions like China, India, Vietnam, and Indonesia, the
demand for electronic devices like Blackberry, iPhone, HTC, Samsung Galaxy, iPad, is being
driven through the roof. That obviously sounds great for the portable devices-hungry people
of the world but the question for us now is, “What does this have to do with silver?”
The answer is EVERYTHING!
The industrial demand due to China and India’s rapid growth will only add to the pressures
that industry already exerts on dwindling silver supplies.
Why Silver?
1) Silver remains the best electrical conductor known to man.
2) Silver is an excellent thermal conductor.
3) Silver has the highest light reflectivity and sensitivity.
4) Silver is highly chemically reactive and is among the most malleable and ductile of
the metals.
5) Silver is highly resistant to corrosion.
Unlike silver, gold only has two basic uses, and both are hoarding type uses where the metal
doesn’t get used up: money and jewellery. Less than 10% of gold production is used in
industrial applications. 90% of all the gold ever mined throughout history is still available for
purchase somewhere.
Silver, on the other, has hundred or industrial uses and applications. The use of silver in the
electrical grid, the demand for TVs, computers, cell phones, batteries and other electronic
devices will continue to grow in both China and India.
Silver is used in:
• Solar energy
• Textiles and Fabric Applications (polyester fiber clothing)
• Food Preparation and Storage Areas
• RFID tags
• Bottled Water Purification
• Home Health Products (toothbrushes, makeup applications, combs)
• Food Processing (milk)
• Silver-based Paper Products for Food Packaging
• Rechargeable Solar Batteries
• Silver Coated Window Insulation
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 8
• Medical Uses (hospitals, wound dressing, antibacterial applications)
• Nanotechnology
• Replacing Platinum Catalysts with less expensive Silver Catalysts
Because of its heavy use as an industrial metal, it is estimated that 90% of all the silver
mined in the past 5,000 years has been used up, thrown away and is unrecoverable.
Recall 10 years ago, a family will share a telephone. Only rich or businessmen will own a cellphone. A
family will share a computer. In this era, one might have more than one phone, more than one
computer and also tablet!
That’s not all; the industrial demand for silver continues to increase as silver’s use in solar,
water purification, and food processing/ preservation. This will continue to increase
dramatically over the next decade. It is interesting to note that the more technology driven
by culture the more silver is used per person. As China continues to modernize more and
more silver will be demanded. At the present time, the Chinese use approximately 1/70th
the amount of silver per capita that is used in North America. This obviously leaves a huge
potential demand increase from China and India as the wealth of that nation increases. As
China and India builds its infrastructure, more and more silver will be needed.
As silver is used in many devices, we are glad that there are no acceptable substitutes so far.
This is mainly because silver usually accounts for only a small part of the total cost involved
and this is why manufacturers won’t cease to use silver in these applications if the price
rises nor will the Armed Forces or Ministry of Defences stop acquiring cruise missiles and
torpedoes because of a substantial jump in the cost of the silver components.
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 9
Reason #3 Precious Metal Bullion Stocks
Number three commences with you doing a little chart reading! The chart below illustrates
the total known world stockpiles of gold and silver, in year 1990, and 2007 respectively.
If you are scratching your head in gasps and questioning if there is a misprint in your
book…STOP IT. This is because Silver’s stockpiles are; in all honesty; depleting or you can say
shrunken dramatically.
Inversely, Gold’s stockpiles are growing and hence in today’s world; according to
purchasable quantities for the first time in recorded history; Silver is more rare than the
much worshipped Gold!
“Gold is held by many governments… silver is held by virtually none.”
- David Morgan, Silver Expert
Now the statement above revalidates itself. In 1979, when investors became net buyers of
silver, driving silver to over $52 in 1980, there were more than 2.5 billion ounces of silver
available for them to buy. Today, just as investors have once again become net buyers, silver
inventories have almost vanished.
Well, you know what happens when demand increases and supply decreases.
If you’re a fan of more chartings, the following ‘Silver Bullion Inventories Chart’ will be of
your immediate interest:
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 1010
One thing that I’ve learnt from the chart above is that once the inventories is at low level, it
is an obvious buy signal.
In fact, it is so absurdly low that it’s unbelievable the public hasn’t already realised how
massively undervalued Silver is, and it’s absolutely astounding that investor haven’t already
flowed towards Silver. But I guess; for the ‘informed’ public; common sense is really the
most uncommon of senses.
That is why I often and still say, “If you think Gold is good, wait till you see Silver!”
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 1111
Reason #4 Economic Silver on the Ground
When I started to realise that the world is running out of silver, I started asking myself,
“Why don’t they just increase the mining production for more silver?”
My research and findings proved to be good news for silver investors…
Most silver supplies don’t come from silver mining operations. Most silver production is
dependent on the mining of other metals. Almost two thirds of the world’s mined silver is a
by-product of the mining of base metals copper, lead, and zinc. Because of the economics
involved, producers are not encouraged to increase their output of silver by an increase in
silver prices alone. Silver presents too small a share of their revenue.
Currently, silver mine production stands at a little over 500 million ounces per year. Primary
silver producers only produce 25 percent of that, or 125 million ounces per year. If you
could freeze demand where it is today, and the primary silver producers were able to
double production, it would take more than fifteen years to get silver inventories back to
the level they were in 1990.
Another good news for silver investors is that the world isn’t just running out of silver
aboveground either, it is also running out of silver in the ground. Minable deposits of silver
are becoming harder to find.
An amazing fact found in United States Geological Survey (USGS) annual mineral reports, at
the current rates of production, there is less minable silver left in the earth’s crust than any
other metal. According to the USGS, at current rates of production, the two metals we will
run out of first are gold and silver. At these rates gold reserves will be exhausted in thirty
years, and silver in just twenty-five.
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 1212
Reason #5 Massive Printing of Money
My foray into the history of precious metals especially for both Gold & Silver is an
interesting one indeed. When I browse through the pages of the past expecting to meet
extensive mentions of the virtue of Gold, I’m surprised. I’m surprised because of the near
impossibility of discussing Gold as money without its partner in metals, Silver.
At times countries have been on a Gold standard or a Silver standard or a dual standard;
taking us far back to the days of Greek and Rome Civilizations.
So fixated is their high perceived value that the first reference I could find to money was in
the Bible:
“Behold, the money, which we found in our sacks’ mouths, we brought again unto thee out
of the land of Canaan: how then should we steal out of thy lord’s house silver or gold?”
- Genesis 44:8
The first monetary transaction recorded in the Bible is also in Genesis. Abraham weighs 400
shekels of Silver to pay for his wife’s burial. This is the same Abraham all three major
religions of the world; Judaism, Christianity and Islam; express as a link to the God of their
faith. This reference to Silver in Genesis applies universally, across cultures, and throughout
the ages.
My study confirmed there are three metals of monetary usage – Gold, Silver and Copper.
Types of Metal Economic Functions
Copper Used mainly as a medium for very small exchanges. Copper was debased
out of the currency system in periods of extreme inflation.
Silver The most useful because gold is simply too rare for common daily
transactions.
Gold Reserved primarily for final payment in large bank-to-bank or nation-to-
nation dealings.
To further compound my findings, Silver’s monetary role has been so universally recognized
throughout history that the very word for silver is synonym with money in many languages.
In Italian, Spanish and French the words for “Money” and “Silver” can be interchanged.
In Hebrew, the word “Kesepph” means both Silver and Money.
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 1313
Many Europeans refer to both Silver and Money as “Argent,” while Spanish-speaking people
the world over use “Plata” to mean Silver, Money or both. Argentina’s name derived from
the Latin word for silver, Argentum. In fact, Argentina actually means “Land of Silver”.
Let me bring you back to Malaysia, the land of three major races: Malay, Chinese & Indian.
In Malaysia, one of the states is known as Perak. Perak’s name is derived from the word
silver or money.
In the Chinese language, we call a bank ‘Ying Hang’. If I were to translate every word by
word, it also means a place to store silver!
Whenever I ask my Indian friends, how do you say “Ten Ringgit” in their Tamil language,
they answer me “Pakke Veli”. Another meaning for “Pakke Veli” means ten pieces of silver.
Silver is likened to one of those ‘love at last sight’ metaphors as Silver is often undervalued
by the masses in comparison to its famed cousin, Gold without realizing the great fortune
that it could offer. Often the common man goes for ‘hottest picks’ that are ‘recommended
by Personal Money’ without doing their due diligence to look at ‘poor man’s Gold’ in hand!
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 1414
A lot of people are worrying about safekeeping physical gold and silver, and that’s why they
prefer paper investment, whereby they don’t have to worry about metal storage. Well, it
makes a lot of sense.
However, if paper gold and silver is good, why would the government of China buy physical
gold and silver if they can actually buy paper and need not worry about storing them in the
vault? And, if paper is good enough, why would China encourage the citizens to invest in
physical gold and silver?
Think about this: Governments and central banks around the world are keeping physical
gold and silver, doesn’t it make a sense for you to invest in physical gold and silver?
Paper gold investment is quite popular among Malaysians and there are many banks that
offer paper gold investment or gold passbook account. Recently, Maybank also came out
with silver saving account, which is also a kind of paper silver investment.
Maybank Silver Passbook Account
Here I would like to point out some important things before you consider investing in paper
gold and silver.
The first and the most important thing is, you do not own real gold and silver when you’re
investing in paper gold and silver. It doesn’t represent your ownership of the physical metals.
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 1515
You do not own the real metals. It is merely paper claim without any physical metal backed
by it.
So, if the banks were shut down, your investment would be wiped out!
Think again. If you purchase physical metals from banks or any dealers, your investment will
not be wiped out when the banks are closed down or the dealers go bankrupt! You own the
real metals whereby you can still sell them anywhere during anytime!
Same goes to ETFs, you have to understand whom and where you are putting your money
into. You do not own the physical gold and silver when you’re investing in ETFs. Your
investment isn’t backed by any real physical metals.
Another thing that you need to know about paper gold and silver investment is the spread.
The buying and selling price are fixed by the banks or financial institutions. You can never
enjoy any discount when you plan to make bulk purchase, and you can also never sell with a
higher premium.
At SilverMalaysia.com & SilverSingapore.com.sg, you can get discount for bulk purchase
when purchasing the physical silver bullions. Furthermore, you can liquidate your physical
silver to the secondary market with the premium that the market is trading at.
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 1616
Silver bars can be a very favourable option for physical bullion investors because of its low
premium. Generally, silver bars have the lowest premium among all kinds of physical silver
bullion.
In silver bullion investment, it is always easy to buy but very hard to sell, especially silver
bars. The price can be very favourable, but when it comes to liquidation, it might be a
problem.
So before putting your cash into silver bars, there are some basic factors that you need to
understand regarding silver bars.
The Rule of Thumb: International Hallmark
When we want to invest in silver bars, there is always a rule of thumb.
When it comes to silver bars, always look for international hallmark. Hallmark is the brand
(usually the name of the mint) of the silver. Silver bars with international hallmarks can be
easily recognized around the world and hence they can be liquidated easier.
If today you own some internationally hallmarked silver bars, you need not have to worry
about the liquidation. Even if the dealers or companies you bought from are going bankrupt
or close down in the future whereby you cannot sell back to them, or you are going overseas,
you can always sell your silver bars around the world with no issues.
Weight does matter
Silver bars come in different weights (and of course sizes). They are measured in troy ounces,
for instance, 1oz, 5oz, 10oz, 100oz or in kilogram, such as 1kg. Some mints produce in
smaller fractions such as ½oz, 5gram and so on.
There are no right and wrong way to invest in silver bars. However, there are some
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 1717
fundamentals that you need to understand. In general, smaller bars will have higher
premium due to fabrication costs. Bigger bars will carry lower premium per ounce above
spot because it is more cost-effective to produce.
However, there is a trade-off of paying lower premium. When it comes to selling, bigger
bars are more difficult to be liquidated. Hence, if you are buying big silver bars such as 1kg
bars and 100oz bars, do make sure that the companies do provide buy back guarantee and
have a strong financial background, so that they can afford to buy back from you when you
wish to liquidate.
My Personal Preference
When it comes to silver bars, I personally prefer investing in 10oz silver bars. The reasons
why 10oz is ideal for me are:
Lower premium (As compare with 1oz bars which most investors buy for its liquidity)
Handy
Affordable
Easier to sell compare to kilo bars and 100oz bars
Scottsdale 10oz Silver Bars (known as “The Stacker”)
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 1818
Silver coins are very popular among bullion investors. The price is usually slightly more
expensive than silver bars due to the tax and tariff during importing. Silver coins have better
liquidity as compare to silver bars, because they are usually guaranteed by governments.
The Rule of Thumb: Legal Tender
Silver coins are also known as legal tender. Before putting money in it, make sure that the
companies or dealers are selling you a legal tender, not a silver round. Silver round is silver
bullion which is round in shape; while legal tenders are coins that issued and guaranteed by
government. When a coin is guaranteed by government, it is given a face value.
Due to this guarantee, silver coins are easier to be liquidated because they are recognized
around the world. When hyperinflation comes and fiat currencies are not being demanded,
people will start trading using gold and silver coins, which are legal tenders. Hence, we buy
silver coins mainly as a form of insurance and prepare ourselves for the upcoming
hyperinflation. Investment comes second.
Silver Coins with Lowest Premium
Out of all the silver coins, there are three kinds of silver coins that carry the lowest premium.
These silver coins are very popular all around the world and hence having fantastic liquidity.
1oz American Silver Eagle
American Silver Eagle (ASE) is the legal tender of US, minted by U.S. Mint. It is made of 99.9%
(.999) fine silver and carries a face value of USD1. It is one of the most popular physical
silver coins among silver investors because of its liquidity.
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 1919
Since its launch in 1986, ASE has become leading bullion coin investment products.
Featuring a rendition of sculptor Adolph A. Weinman’s magnificent Walking Liberty design, it
is known for its beauty and fine quality production.
1oz Canadian Maple Leaf Silver Coin
The Canadian Maple Leaf silver coin is the official silver coin of Canada, minted by Royal
Canada Mint since 1988. This is also one of the most popular coins among bullion investors
and in general, it has a lower premium compare to American Silver Eagle.
This is the purest silver coin which is made of 99.99% (.000) fine silver. As a legal tender of
Canada, it carries a face value of CAD5, which is also the highest among all silver coins.
1oz Austrian Philharmonic Silver Coin
The Austrian Philharmonic silver coin is struck in 99.9% (.999) fine silver. The Silver
Philharmonic is backed by the government of Austria and minted by the Austrian Mint in
Vienna. The Austrian Mint is internationally famous for their production of exceptional coins
for over 800 years.
The Austrian Silver Philharmonic Coin is the number one silver coin in Europe and a legal
tender coin of Austria, carrying a face value of 1.50 Euro. It is coveted not only in Europe but
also throughout the world making them highly liquid.
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 2020
When it comes to storage, a lot of people are worrying about it. Consider about two factors:
• The amount of physical silver
• Your comfort level
The amount of physical silver
One of the considerations when it comes to storing physical silver at home is the space
occupied. If you are not a heavy investor, you can always keep your silver in your lockable
drawer or cupboard, in your room and anywhere you think it is secure.
If you’re a heavy investor and plan to invest a monster box or more, you should consider
buying a safety box and store your silver inside.
Alternatively, you can consider renting a safe deposit box with a little cost.
A monster box of American Silver Eagle, filled with 500oz of coins
Your comfort level
When it comes to storing silver at home, it highly depends on your own comfort level. We
have encountered investors who worry to store even a single piece of silver at home; and
we have also met investors who just put their monster boxes at a corner of the living room.
It will always be better to make your storing decision private, so that less people will know
where you are storing your physical silver. Once you have established you confidence with
your decision, you will slowly understand the benefits of storing silver at home.
Silver Investors Starter Kit By Jonathan Quek
© SilverMalaysia.com – All Rights Reserved 2121
rue North Asia Sdn.
About Us
SilverMalaysia.com is owned and operated by T Bhd. (Company No.
902968-P), a private limited company incorporated in Malaysia under the Companies Act
1965. SilverMalaysia.com was established with a vision to be the No.1 gold & silver
education and physical silver bullion provider in Malaysia.
SilverMalaysia.com was founded in Year 2010 by renowned gold & silver expert, Jonathan
Quek. Together with his strategic team of specialist, SilverMalaysia.com is dedicated to
prepare Malaysians for hyperinflation and helping Malaysians not only survive, but also
prosper in the upcoming global hyperinflationary crisis.
SilverMalaysia.com believes that the largest global financial crisis in history is ahead of us as
a direct result of the mass printing of the U.S. Government. At the same time, we believe
that the greatest investment opportunity in history is knocking on our door as well. The
choice to open it, or not.. is yours.
Vision
To be the No.1 gold & silver education and physical bullion provider in Asia.
Mission
1. To EDUCATE Asians on the Importance of Gold & Silver in the current Debt-Ridden
World.
2. To put honest money - PHYSICAL GOLD & SILVER, in the hands of Main Street Asia, one
Asian at a time.
Recommended