Focused on silver
Acquisition & Production of high grade, low cost Silver resources - Mexico & El Salvador
Message: OT: Kitco with a catch
More and more comedy from the good people at Kitco. SMF
Silver At Just $1.79 Over Spot? There Is One Minor Catch...
05/01/2013
Those who have been following the barren wasteland that is the precious metals retail market know that not only is it virtually impossible to get any silver for less than a $3-4 premium per ounce over spot, but it has become next to impossible to find any physical, period. So the fact that Apmex is now selling silver at just a $1.79 over spot - a bargain even in the days when JPM wasn't about to run out of commercial gold (incidentally no change in the gold held at the firm's 1 CMP vault as of yesterday's close), and certainly a blue light special at a time when the entire world is scrambling for anything shiny. There is however one minor catch. Maybe not so minor. Because while most PM afficionados are used to buying silver by the ounce, or at most bar, the Apmex offer involves a very generous dollop of Silver Koala. 1 Kilogram's worth of generous.
Yup: the $1.79 premium over spot offer is only applicable to 1 kilo (32.15 oz) "coins" - not exactly a conventional, "carry in your pocket" kind of weight, or one amenable to transactions in a post-Bernanke world.
Which brings up an interesting point: is the massive premium over spot for silver only due to the practical size of the most common, and thus cheapest, 1 oz denomination? Does silver only have a sizable physical premium when it is in a handy denomination - do heavier variants necessarily lose their premium over spot. And if so, is the relationship linear or convex - is there no premium at all if one was buying or selling all the physical outstanding (at least in a thought experiment).
Of course, it may just be a good liquidation deal (and no, ZH is not getting any money, or physical, for this post).
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