Interesting Sales Trend Emerges - What’s Your View?

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Published : June 06th, 2012
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Category : Market Analysis

 

 

 

 

We’re witnessing an interesting new sales trend. Demand for 1/2oz silver bullion coins are increasing significantly – and we wouldn’t mind your thoughts on what’s happening.

Here’re our sales figures for 1/2oz Lunar and Koala silver bullion coins during the past five years:

YEAR

LUNAR

KOALA

2012

270,580

88,610

2011

124,488

76,755

2010

50,035

13,315

2009

17,674

15,334

2008

17,114

13,944


As you can see, growth has been particularly strong over the past two years. And remember, there are still almost seven months remaining before production of 2012 1/2oz Lunar and Koala coins is cut off.

We’ve considered three possible explanations.

Because 1oz Lunar silver bullion coins sold out in each of the above years, some buyers opted for the smaller denomination of this popular series

Increasing metal prices forced some investors to buy smaller denomination silver offered by the Koala series

Divisibility became more of an issue for investors – with selling back in mind, they swapped the cost-effectiveness of large silver coins for the flexibility offered by small coins

As I said, this is conjecture.

In recent times Perth Mint 1/2oz silver bullion coins have been temporarily out-of-stock. We now have stock for those looking to buy.




So if you’ve changed your purchasing pattern and introduced more 1/2oz silver bullion coins to your precious metal pool, we’d really like to hear from you.

In short, is this a trend that’s likely to continue?

 

 

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I'd be interested to know if the trend is reflected in gold. Are the smaller 1/10 gold coins becoming more popular? Yes I've got about 10% of my silver stack in 1/2 oz coins.

Why? I buy gold and silver for 2 reasons:
a) Investment / Inflation hedge
b) Catastrophe insurance

I buy larger, cost-effective portions to satisfy a).
I buy smaller 1/2oz and 1oz lots for reason b).

So... let' say Henny Penny is right and the sky really does fall on the world financial system. The Euro dies, the US dollar dies, Sovereign nations implode, fiat currency hyperinflation... pick your poison. This has all been said before but it may happen... what if it does? If PM's are needed as the best medium of exchange in a "Mad Max" scenario or transition period to some new "Brave New World" currency then this is where these little guys come into play.

A 10oz or 1kg bar of silver is worth far too much to be used as a daily medium of exchange - especially so in those conditions. It's hard to conceal and would likely get you gutted in a dark alley if you produced such an item in public asking for "change". A 1/2oz silver coin or two would be perfect to trade for small items such as food, clothes etc.

In my view this is a fear-bet. People are accumulating a small stash of "real money" to be used in a worst-case scenario. They're not looking to re-sell on eBay for 50% profit. They're making sure their family is fed if the sh*t hits the fan.

This is the reason I first bought silver years ago - the fear factor. Now I'm accumulating PM's to profit AND to survive. If/when the bull markets in gold and silver go parabolic, I'll be selling on the way up - but never all my stash. When gold is this popular the USD will probably be shunned... and the fear of financial collapse will be at its peak. This is when we need our "catastrophe money" the most... credit markets will be seizing up, banks dropping like flies, importing and exporting may grind to a snails pace, faith in anything paper may fail, people will panic. If this day comes it will be the 1/2oz and 1oz silver coins (and 1/10oz gold coins) that I have left over - to be used for the basics until the world can back on it's financial feet again.

2 very different motivations. I beleive it's the fear-buyers that are buying in smaller coins.
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I'd be interested to know if the trend is reflected in gold. Are the smaller 1/10 gold coins becoming more popular? Yes I've got about 10% of my silver stack in 1/2 oz coins. Why? I buy gold and silver for 2 reasons: a) Investment / Inflation hedge b)  Read more
dom1971 - 6/7/2012 at 8:41 AM GMT
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