Best of the Week
Most Popular
1. Investing in a Bubble Mania Stock Market Trending Towards Financial Crisis 2.0 CRASH! - 9th Sep 21
2.Tech Stocks Bubble Valuations 2000 vs 2021 - 25th Sep 21
3.Stock Market FOMO Going into Crash Season - 8th Oct 21
4.Stock Market FOMO Hits September Brick Wall - Evergrande China's Lehman's Moment - 22nd Sep 21
5.Crypto Bubble BURSTS! BTC, ETH, XRP CRASH! NiceHash Seizes Funds on Account Halting ALL Withdrawals! - 19th May 21
6.How to Protect Your Self From a Stock Market CRASH / Bear Market? - 14th Oct 21
7.AI Stocks Portfolio Buying and Selling Levels Going Into Market Correction - 11th Oct 21
8.Why Silver Price Could Crash by 20%! - 5th Oct 21
9.Powell: Inflation Might Not Be Transitory, After All - 3rd Oct 21
10.Global Stock Markets Topped 60 Days Before the US Stocks Peaked - 23rd Sep 21
Last 7 days
Stock Maket Trading Lesson - How to REALLY Trade Markets - 26th Nov 21
SILVER Price Trend Analysis - 26th Nov 21
Federal Reserve Asks Americans to Eat Soy “Meat” for Thanksgiving - 26th Nov 21
Is the S&P 500 Topping or Just Consolidating? - 26th Nov 21
Is a Bigger Drop in Gold Price Just Around the Corner? - 26th Nov 21
Financial Stocks ETF Sector XLF Pullback Sets Up A New $43.60 Upside Target - 26th Nov 21
A Couple of Things to Think About Before Buying Shares - 25th Nov 21
UK Best Fixed Rate Tariff Deal is to NOT FIX Gas and Electric Energy Tariffs During Winter 2021-22 - 25th Nov 21
Stock Market Begins it's Year End Seasonal Santa Rally - 24th Nov 21
How Silver Can Conquer $50+ in 2022 - 24th Nov 21
Stock Market Betting on Hawkish Fed - 24th Nov 21
Stock Market Elliott Wave Trend Forecast - 24th Nov 21
Your once-a-year All-Access Financial Markets Analysis Pass - 24th Nov 21
Did Zillow’s $300 million flop prove me wrong? - 24th Nov 21
Now Malaysian Drivers Renew Their Kurnia Car Insurance Online With Fincrew.my - 24th Nov 21
Gold / Silver Ratio - 23rd Nov 21
Stock Market Sentiment Speaks: Can We Get To 5500SPX In 2022? But 4440SPX Comes First - 23rd Nov 21
A Month-to-month breakdown of how Much Money Individuals are Spending on Stocks - 23rd Nov 21
S&P 500: Rallying Tech Stocks vs. Plummeting Oil Stocks - 23rd Nov 21
Like the Latest Bond Flick, the US Dollar Has No Time to Die - 23rd Nov 21
Why BITCOIN NEW ALL TIME HIGH Changes EVERYTHING! - 22nd Nov 21
Cannabis ETF MJ Basing & Volatility Patterns - 22nd Nov 21
The Most Important Lesson Learned from this COVID Pandemic - 22nd Nov 21
Dow Stock Market Trend Analysis - 22nd Nov 21
UK Covid-19 Booster Jabs Moderna, Pfizer Are They Worth the Risk of Side effects, Illness? - 22nd Nov 21
US Dollar vs Yields vs Stock Market Trends - 20th Nov 21
Inflation Risk: Milton Friedman Would Buy Gold Right Now - 20th Nov 21
How to Determine if It’s Time for You to Outsource Your Packaging Requirements to a Contract Packer - 20th Nov 21
2 easy ways to play Facebook’s Metaverse Spending Spree - 20th Nov 21
Stock Market Margin Debt WARNING! - 19th Nov 21
Gold Mid-Tier Stocks Q3’21 Fundamentals - 19th Nov 21
Protect Your Wealth From PERMANENT Transitory Inflation - 19th Nov 21
Investors Expect High Inflation. Golden Inquisition Ahead? - 19th Nov 21
Will the Senate Confirm a Marxist to Oversee the U.S. Currency System? - 19th Nov 21
When Even Stock Market Bears Act Bullishly (What It May Mean) - 19th Nov 21
Chinese People do NOT Eat Dogs Newspeak - 18th Nov 21
CHINOBLE! Evergrande Reality Exposes China Fiction! - 18th Nov 21
Kondratieff Full-Season Stock Market Sector Rotation - 18th Nov 21
What Stock Market Trends Will Drive Through To 2022? - 18th Nov 21
How to Jump Start Your Motherboard Without a Power Button With Just a Screwdriver - 18th Nov 21
Bitcoin & Ethereum 2021 Trend - 18th Nov 21
FREE TRADE How to Get 2 FREE SHARES Fractional Investing Platform and ISA Specs - 18th Nov 21
Inflation Ain’t Transitory – But the Fed’s Credibility Is - 18th Nov 21
The real reason Facebook just went “all in” on the metaverse - 18th Nov 21
Biden Signs a Bill to Revive Infrastructure… and Gold! - 18th Nov 21
Silver vs US Dollar - 17th Nov 21
Silver Supply and Demand Balance - 17th Nov 21
Sentiment Speaks: This Stock Market Makes Absolutely No Sense - 17th Nov 21
Biden Spending to Build Back Stagflation - 17th Nov 21
Meshing Cryptocurrency Wealth Generation With Global Fiat Money Demise - 17th Nov 21
Dow Stock Market Trend Forecast Into Mid 2022 - 16th Nov 21
Stock Market Minor Cycle Correcting - 16th Nov 21
The INFLATION MEGA-TREND - Ripples of Deflation on an Ocean of Inflation! - 16th Nov 21

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

How to Buy Silver by Taking Delivery of a Futures Contract

Commodities / Gold & Silver Sep 25, 2008 - 07:11 PM GMT

By: David_Morgan

Commodities

Best Financial Markets Analysis ArticlePrecious Metals in the Physical Realm - This week I thought I would take a question and add some comments.

Dear David,

I wanted to get your thoughts on this response by Richard Russell. He makes an interesting point! We are already seeing trading physical precious metals in a market disrupted by shortages. (Name withheld upon request)


" Question – Russell, would you talk a bit more about your preference for gold coins in one's possession vs. GLD, which you term "paper gold" and SLV, which you call "paper silver."

Richard Russell's Answer – Yes, as I see it, the authorities are doing whatever they want. I'm more inclined to hold actual gold coins. The SEC now disallows shorting in 799 financial equities, an amazing turn of events. Now with central banks all over the world releasing vast quantities of fiat money, it's entirely possible that gold will embark on a major rise. If this happens, it will throw suspicion on all fiat currency, which is the last thing the central banks want. Under these conditions, it would not surprise me for the Fed and the SEC to halt all trading in gold, and the easiest place to monitor such an edict would be GLD. In 1933 the government ordered in all gold held by the US population. I can't see that happening, but I can see all trading halted. This would throw gold into the black market and make it very difficult to price or sell your gold. In France, people are forbidden to take any gold out of the country. Remember, gold is the enemy of fiat paper, and in that, there is a story. Rising gold throws suspicion on ALL fiat and central bank issued currency.

It has been one of my strongest points to teach all investors how important gold and silver are under any financial climate. Some took positions early and others are now coming to the realization that having gold and silver is crucial for proper portfolio diversification.

Today we are getting feedback from many of the largest retail metals dealers that finding gold and especially silver is becoming increasing difficult. Additionally, some of our sources on the wholesale side are also expressing concern that the market is tightening significantly.

In my view, Russell is one of the true “masters” of market forecasting. I would state he makes a valid point that the possibility does exist. I would like to go one step further and point out that a well-known bullion dealer pointed out the same concern a few weeks ago. In fact, that missive was sent out to our free e-mail list. If you are personally comfortable trading shares in the ETF, then go ahead. But I would add, just be sure that you have (enough) metal you actually hold before you invest/trade the precious metals ETFs.

Many commentators have different views on ways to invest in the precious metals, and personally, my objective is for each individual to study for himself or herself what makes the best choice for their particular circumstances. In other words, make your own decision and take personal responsibility for that decision.

As most reading this know, there is a large discrepancy between the futures price and the actual “ask” price by the retail dealer community. I agree that taking delivery of COMEX bars is cumbersome and they do weigh approximately 70 pounds. However, we have been asked again and again and again, “How is it done?” Below is an outline of the procedure. This in NOT my work but was presented at the recent Silver Summit 2008 by a broker I know and trust. This information will appear in full in the next issue of The Morgan Report.

Buying Silver at Spot

Here's how it works:

  • Spot price is based on the nearby futures contract
  • Open a futures account and fund it with the full value of the silver futures contract
  • Buy a silver futures contract
  • By buying a futures contract you are making an obligation to buy silver at a specific price at a future date
  • After first notice day you will take delivery of physical silver by receiving a warehouse receipt
  • You can either have your physical silver sent to you or keep it stored at the warehouse

The “Mini” 1,000-Ounce Silver Contract Is Deliverable

There are some nominal fees associated with taking delivery of a “Mini” silver contract including:*

$25.00 delivery fee
$25.00 processing fee
$15.00 warehouse delivery fee

Approximately $100.00–$200.00 delivery/packing charges, depending on where the silver is to be delivered

*Approximately $4.00–$6.00 per month storage fee may apply

Disclaimer 

You should familiarize yourself with the full contract specification of this product. Applicable exchange fees apply. Delivery fees may vary. Please consult your broker for more information . Futures trading involves substantial risk. Therefore only risk capital should be used when trading futures.

In summary, I am not saying you should take delivery of thousand-ounce bars, but I am suggesting that at least you know the procedure and make the choice that best suits your needs.

It is an honor to be,

By David Morgan,
Silver-Investor.com

Mr. Morgan has been published in The Herald Tribune , Futures magazine, The Gold Newsletter , Resource Consultants , Resource World , Investment Rarities , The Idaho Observer , Barron's , and The Wall Street Journal . Mr. Morgan does weekly Money, Metals and Mining Review for Kitco. He is hosted monthly on Financial Sense with Jim Puplava. Mr. Morgan was published in the Global Investor regarding Ten Rules of Silver Investing , which you can receive for free. His book Get the Skinny on Silver Investing is available on Amazon or the link provided. His private Internet-only newsletter, The Morgan Report , is $129.99 annually.

Contact information: silverguru22@hotmail.com , http://silver-investor.com

Disclaimer: The opinions expressed above are not intended to be taken as investment advice. It is to be taken as opinion only and I encourage you to complete your own due diligence when making an investment decision.

David Morgan Archive

© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in