What is Coin Collecting
Coin collecting vs stacking, coin collecting is somebody who collects specific types of coins based on quality and other factors. An example is someone who buys Morgan Dollars to collect all the years and variations. Other people might collect based on metal content, things they like, or certain countries/time periods. this is similar to gold and silver stacking in some ways but not everyone who coin collects buys gold and silver coins.
Coin collecting is a great hobby for many people who may not even be aware of it. Do you know someone who loves ancient Rome? but they don’t coin collect? buying them an ancient roman coin as a gift could be a really interesting gift with historic significance. It’s not every day someone can own/afford their own piece of ancient history.
What is Precious Metal Stacking
Another alternative to coin collecting is precious metal stacking or as some people call it being a “stacker”. The goal of this is To accumulate as much gold and silver as possible at the lowest possible price point. This usually means buying gold or silver bullion during points of time when everyone is saying “it’s a bad time to buy gold” because the price is going down.
What most people do will pick a type of coin to start buying ether weekly, bi-weekly or monthly. A standard bullion coin in Canada is the Canadian Silver Maple (Photo Below). Silver stacking can be a fun and rewarding hobby simply from all the affordable 1 – 5 troy ounce options out there. There is a lot of options and advice when it comes to silver and gold stacking. Often it’s best to do your own research and buy what you find interesting.
Benefits of Stacking vs Coin Collecting
Stacking is a great place to start for beginners. It’s simple and straight forward and cost averaging is your best friend. We do advise doing your own research on gold and silver before investing in precious metals. If you do decide however we recommend starting with stacking.
A bullion coin when you buy it is worth usually 90-95% of what you paid for it. If you bought a 1oz coin for 40$ you could most likely sell it right back for 36-38$. This is the opposite of numismatic coin collecting where a coin might only have 20% or less of the metal value vs what you paid.
This means you can get into precious metal staking without too much worry of losing all of your money because there are places always buying precious metals at the global spot price.
Cost Averaging is your Friend
You might be sitting there wondering “why can’t I do both?” Well, that’s because you can. If on one hand, you buy 100$ 1 ounce silver coin from a mint, on the other hand, you buy 2 bullion 1-ounce coins for 3-6$ over spot totaling 35$ for each one.
If the spot is let’s say 29-30$ per ounce. That means you have 1 coin at 100$, 2 at 35$ for a total of 3. Then add those together (100+35+35=170) then you divide that number by 3 (170÷3=56.67). This means each coin now has a profit point of 56.67 cents.
If the spot price goes 100$+/Per ounce (100-56.67= 43.33$) you make a profit of 43.33$/per coin even though the spot price is equal to the 100$ you paid for the Mint coin.
Simple Rules to Live by
- it’s easier to stack and cost average the same precious metal (for example cost average fine silver with fine silver rather than 80-90% silver). Silver stacking requires some basic math which makes it a simple tool to use.
- Higher value coins are good for buying and holding 10, 20, 30 years where the bullion can be sold in emergencies and then re-bought with minimal loss.
- Silver and gold stacking is god for someone who thinks precious metal prices will continue going up in price over the next few decades. There are tons of great resources for gold and silver stacking advice
- Silver stacking advice given from strangers or individuals that are not part of an established business should be taken with a grain of salt. Precious metal stacking is not a get rich quick scheme and shouldnt be treat as such. Precious metal stacking is a better alternative to a Savings account.
- The majority of your “Coin & Precious Metal Collection” should be in more bullion with 10-25% being in higher value precious metal numismatics.
We hope you have found this helpful, if so we recommend checking out some of our other blog posts! you can also check out some of our available coins.