The Royal Mint is offering investors tired with the poor returns from low-interest rates an opportunity to invest in silver in its new trading platform. Collectors and investors can now buy, trade and store bullion coins from The Mint which offers a range of three silver coins. They include the Britannia fine silver coins, Lunar coins of the Shengxiao Collection, and the Queens’s Beasts range of 2oz and 10oz silver bullion.

Why Invest in Silver Bullion?

Bullion is the term used to describe silver in bulk form. To calculate its value, you first base the mass and purity of the coin or jewelry which are traded via brokers, online platforms or in auctions.

Whatever your budget, Signature is an ideal way to trade and invest in physical silver coins or jewelry. With a minimum budget of £20, Signature allows you access to the precious metal market where you can buy a fraction of silver. Royal Mint will offer you a vault, which is one of the most secure sites in the UK to store your silver.

Investing in precious metals such as silver has many advantages. For starters, you have the benefit of touching or holding the silver coin. A bullion investment will also provide useful alternatives for diversifying your investment portfolio during uncertain economic periods. Despite silver recently falling 18% in value to $17 an ounce, it still boasts a big demand, particularly for jewelry in the emerging markets and among coin collectors.

It’s worth noting silver Britannia and Lunar bullion coins are exempt from UK Capital Gains Tax for UK residents, as its considered legal tender.

Why Invest in Silver?

After the introduction of silver bullions, the precious metal market is now accessible to the average investor. This is because smaller silver coins produced by The Mint provide a cheaper means for entering the market.

Investing in coins is seen as a more suitable option for investors making a modest outlay in precious metals. Considerations you should bear in mind when investing in bullions include:

  • Capital Gains Tax – Capital Gains Tax is an important consideration to make when investing in bullions. This is because all The Mint’s current range of silver bullion coins have legal tender status and are exempt from UK capital gains tax, for UK residents. But silver bullion coins are subject to VAT at the standard rate.
  • Resale – After you buy bullion, consider how you will sell it. As bullion coins have a certain coin collectors appeal, they are easier to sell than gold bars, which tend to sell for their intrinsic value.
  • Purchase premium – In terms of cost, as the quantity of silver bullion increases from 1g upwards, the purchase premium decreases. This is partly due to The Mint’s lower storage and manufacturing costs.

Other Investment Platforms

BullionByPost offers a service that allows investors to buy and sell a range of coins and bars. They store your metals for 0.65 % per year based on the value of the precious metal held in the vault. The minimum charge is  £10 per month inclusive of insurance.

Another service is BullionVault which allows users to buy and sell metals from each other, at prices set by the service provider. It allows clients to hold their silver in vaults controlled by BullionVault in either London, Zurich, Singapore, Toronto, or New York, depending on the client’s preference.

By Jeff Mwaura, Jeff is Kenyan based freelance writer with a focus on technology and finance.