Gold hit a new high today, closing around $1,237/ounce after trading at almost $1,250/oz during the intraday session. Silver, which is already up 30% since its lows of $15.13 in February followed to $19.56/ounce.
I've been collecting both gold and silver coins since late 2005, during which time gold was trading for $495/oz and the price of silver was under $10/ounce. I currently own over 50 silver coins. Before you get all excited, the value comes to around $1,000 and it's a big hassle to store them. But, being a big fan of shiny objects I still like to buy coins now and then.
My favorites are the 1 ounce Australian Lunar Series, the Peace silver dollars and the Morgan silver dollars. But this time, I thought I'd try something different. I bought a couple of the Nazi 5 Reichmark silver coins. No, I'm not a big fan of Nazi memorabilia or anything like that. It's just that these coins are 90% silver and each one contains about 0.40 ounces of silver. Considering that silver bullion coins sell for about $22 right now, the silver in those coins is worth about $8.80. I just spent about $10.50 for each coin or about $1.70 more than I would've paid for a silver bullion coin.
Not bad for a piece of history!
Historically, silver has traded for about 1/15th the price of gold which means it would be trading around $75/oz today. Even if we consider that it trades for 1/50th, it should still be at $25/oz. I think we'll see silver at $25/oz within 12 months, which means it has to jump another 20%. Let's see how that works out. It will probably pull back a little before it makes any major moves to the upside. I'll be buying more silver coins if that happens. Although I'm not sure what I'll do with them. I might have to start burying them!