Invest In Silver: A Guide To Using Fidelity

Silver is a precious metal that has historically performed well during times of inflation and economic uncertainty. Investing in silver can provide diversification within your portfolio. There are several ways to invest in silver through Fidelity, including trading bullion, bars, and coins. The minimum initial investment in a non-retirement account is $2,500, while the minimum initial investment in an IRA is $1,000. It's important to note that the precious metals market can be extremely volatile, so it may not be suitable for all investors.

Silver bullion bars and coins

When investing in silver bullion, it is important to consider the purity of the metal. Silver bullion bars and coins are typically 99.9% pure silver, also referred to as. This level of purity ensures that your investment retains its value and can be easily liquidated if needed.

There are a variety of silver bullion bars and coins available for purchase. Silver bars are typically measured in troy ounces and can range from smaller sizes, such as 5 grams, to larger bars of 100 ounces or more. Silver coins are also a popular option, with many government-issued bullion coins available, such as the Silver American Eagle, Silver Canadian Maple Leaf, and Silver Australian Kookaburra. These coins often have beautiful designs and are highly recognised, making them a desirable choice for investors and collectors alike.

When purchasing silver bullion, it is important to use a reputable dealer, such as the United States Mint or the Royal Canadian Mint. These dealers provide high-quality products and careful audits to certify the authenticity of your silver. Additionally, consider the storage and insurance of your silver bullion. Some dealers offer secure storage options with insurance coverage, ensuring the safety of your investment.

Silver ETFs and mutual funds

ETFs, or exchange-traded funds, are baskets of individual investments that can be traded on an exchange like a stock. A silver ETF will typically hold assets that are linked to the price of silver, such as silver mining stocks or silver futures contracts. This means that the value of the ETF will generally track the price of silver, providing investors with a simple way to gain exposure to the silver market. Silver ETFs can be bought and sold through a brokerage account, and they offer more flexibility than physical silver as they can be traded during market hours in smaller increments than physical bullion.

Mutual funds, on the other hand, are not traded on an exchange but are instead purchased directly from the fund company or through a broker. Mutual funds also hold a basket of investments, and a silver mutual fund will typically hold assets related to the silver industry, such as stocks of companies involved in silver mining or production. Mutual funds are professionally managed, and they offer the advantage of diversification as they invest in a range of different companies.

Both ETFs and mutual funds provide a more indirect way to invest in silver compared to purchasing physical silver, and they can offer greater diversification for investors. However, it is important to note that these investment vehicles come with their own set of risks, including the risk of losing money if the price of silver declines.

When investing in silver ETFs and mutual funds, it is essential to do your research and understand the specific holdings of the fund, as well as the fees and expenses associated with the investment. It is also important to keep in mind that the precious metals market is extremely volatile, and investing in silver may not be suitable for all investors.

Silver futures

When investing in silver futures, it is important to consider the highly volatile nature of the precious metals market. Silver futures may not be suitable for most investors due to the potential for significant price fluctuations.

Fidelity offers investors the opportunity to purchase silver as part of a diversification strategy. They provide access to physical silver in the form of bullion bars and coins, as well as exposure to the silver market through mutual funds and exchange-traded funds (ETFs) that invest in companies involved in silver production.

It is worth noting that there are minimum initial investment requirements and storage fees associated with purchasing precious metals through Fidelity. Investors should carefully consider their investment objectives, level of experience, and risk appetite before investing in silver futures or any other financial instrument.

Silver mining stocks

First Majestic Silver (NYSE:AG)

First Majestic is a Canadian company that focuses on silver mining in Mexico, the world's largest producer of silver. They operate three mines in Mexico with several others under development. They also own the Jerritt Canyon Gold Mine in Nevada. First Majestic is expected to derive more than 50% of its revenue from silver, positioning them as one of the purest plays on silver in the mining sector.

Pan American Silver (NASDAQ:PAAS)

Pan American Silver considers itself the world's premier silver mining company, with the largest silver reserves globally. They have seven producing silver and gold mines across North and South America and several potential growth projects. The company has a strong financial position and generates free cash flow, allowing them to fund expansions while returning cash to investors.

Wheaton Precious Metals (NYSE:WPM)

Wheaton Precious Metals is a streaming company, providing cash to mining companies for development costs in exchange for the right to buy produced metal at fixed prices. Their portfolio includes 18 operated mines and 29 development projects. They derive more than 60% of their revenue from gold and over 35% from silver. Wheaton's business model enables them to benefit from rising silver prices with less risk than traditional mining companies.

Hecla Mining (NYSE HL)

Hecla Mining is the largest silver producer in the United States, with a focus on continuous improvement and innovation. They have achieved significant increases in silver reserves, production, and revenues over the past five years. Hecla Mining aims to increase its silver production to 20 million ounces by 2026.

MAG Silver (MAG)

MAG Silver's principal asset is the high-margin underground silver project Juanicipio in Mexico, in which they hold a 44% interest. In the first half of 2024, Juanicipio achieved impressive silver and silver-equivalent production. They are also executing exploration programs at the Deer Trail Project in Utah and the Larder Project in Canada.

Vizsla Silver (VZLA)

Vizsla Silver is advancing its flagship, high-grade Panuco silver-gold project in Mexico, which is one of the highest-grade silver primary discoveries globally. The project is expected to produce an average of 15.2 million silver-equivalent ounces annually, with substantial free cash flow generation prospects. Vizsla Silver has completed extensive drilling at Panuco, leading to the discovery of several high-grade veins.

Other Notable Silver Mining Stocks:

• SilverCrest Metals (TSX SIL)
• Aya Gold & Silver (TSX AYA)
• Gatos Silver (TSX GATO)
• Endeavour Silver (TSX EDR)
• Silvercorp Metals (TSX SVM)
• Collective Mining (TSX CNL)
• GoGold Resources (TSX GGD)
• Osisko Development (TSX.V ODV)
• Americas Gold and Silver (TSX USA)
• Dolly Varden Silver (TSX.V DV)
• Aftermath Silver (TSX.V AAG)
• Blackrock Silver (TSX.V BRC)
• Guanajuato Silver (TSX.V GSVR)
• Kuya Silver (CSE KUYA)
• Silver Elephant Mining (TSX ELEF)
• Excellon Resources (TSX EXN)
• Silver47 Exploration (TSX.V AGA)
• Silver Mountain Resources (TSX.V AGMR)

Silver as a diversification strategy

Silver, along with other precious metals, has historically performed well during times of inflation and economic uncertainty. As such, investing in silver can provide a good diversification strategy within your portfolio. Silver is also a good option for those looking to hedge against inflation.

Fidelity offers investors the opportunity to purchase precious metals as part of a diversification strategy. You can trade in bullion, bars, and coins in silver, with a minimum initial investment of $2,500 in a non-retirement account and $1,000 in an IRA. Trading hours are from 8:00 a.m. to 3:00 p.m. ET, and all trades must be placed through a representative. It's important to note that the precious metals market can be extremely volatile, so it might not be suitable for all investors.

When investing in silver, there are two main options: physical silver and silver-related financial investments. Physical silver includes bullion, bars, coins, and jewelry, and can be bought from individuals, jewelers, silver dealers, and some banks. On the other hand, silver-related financial investments include silver funds (ETFs and mutual funds), silver futures, and silver stocks.

Silver funds are a simple way to invest in silver without taking physical ownership. The price of a silver ETF, for example, is linked to the price of silver, and investors can buy and sell shares like they would with a stock. Silver futures are contracts that allow you to buy or sell a specific amount of silver at a specific price and date in the future. Silver stocks, meanwhile, provide indirect exposure to the price of silver through companies that mine silver and other metals.

Before investing in silver, it's important to consider your investing objectives and risk tolerance. While silver can be a good diversification strategy, it's important to remember that the market can be volatile and may not be suitable for all investors.

Frequently asked questions