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Author Topic: If Silver is in a Bull Market, Why Am I Selling?  (Read 934 times)
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tamo42
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« on: 2011 Apr 20, 04:37:55 pm »

I have been asked a few times in the chat why I am selling some of my coins, both here on LBC and on eBay. In this post, I will explain how it is that I am both bullish on and selling silver.

The first thing to understand is that there are many different kinds of silver. Broadly speaking we can categorize them as physical bullion, numismatic, and paper.  Bullion consists of bars, ingots, rounds, bullion coins, and "junk" coins. Most of my bullion is in junk silver coins.

Numismatic silver consists of coins that have a collector value in excess of their metallic value. The Chinese coins that we talk a lot about here would be examples.

Paper silver consists of securities whose value is based on physical silver and are traded on various international markets (stock markets, foreign exchange, futures, etc). As a security, many of these forms of paper silver have derivatives associated with them.

Personally, I use all 3 forms for different purposes. I have bullion for a long term store of value. I use paper silver for very fast trading profits. I use numismatics as a an in-between form that has both trading characteristics and long term value.

My bullion I am not selling at all. It is there for the long term.

My paper silver I am constantly in and out of. Last week I made 5-10% day trades a couple times. Today I closed out a position that profited me 40% over 2 days. Incidentally, I closed this position because of the weird holiday/expiration schedule that is coming up this weekend.

My numismatics is where most of the questions come from. I am selling those portions of my collection in which I either have multiple copies or the pieces aren't terribly rare. I take those profits and then reinvest in different and/or more valuable pieces.

In all, my strategies are designed to sell those things that enable me to buy more. This is called accumulation. so yes, I am happy to sell some coins and give LBC readers a better deal than can be had on eBay because it frees up my cash to buy other things.
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badon
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« Reply #1 on: 2011 Apr 20, 04:53:39 pm »

That's an excellent explanation for a very common question, thank you. Selling is part some common techniques for maximizing profits, and increasing the quality of your portfolio. Selling is something I have a hard time doing, when I know as much as I do about the investment potential of even the coins I might like to sell.
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« Reply #2 on: 2011 Apr 22, 11:06:33 am »

If I am not selling, why is silver still in a bull market? Because silver has a life of its own.
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