If you research 'investing in silver' online, you may have come across a great phrase called 'Silver Stacking'. This is a term that has grown in popularity and is now used to describe a person who accumulates small pieces of silver like coins, bars, and other hand poured silver items. This article takes a further look at what stacking is, and what it means to be a serious silver stacker.
What is a Silver Stacker?
Simply put, a 'silver stacker' is someone who collects physical silver pieces (normally bullion) and quite often has targets of accumulating a certain volume of the precious metal within a certain timeframe. The term 'silver stacking' is the activity that derives from the storage-need to stack these pieces of silver on top of each other, and as a way to present a collection with maximum visibility to other stackers or trusted friends.
The vast majority of Silver Stackers keep their silver investing secret. Seeking Alpha states that one of the most beautiful things about stacking physical metals is the "private practice involved". Many stackers wouldn’t dream of producing online content of their investments for public consumption. If you have physical silver in your collection/investment portfolio, chances are, you're considered to be a silver stacker already. Silver Stacking is something many of our customers are doing already, maybe without even realising it.
There is a host of silver stackers who love to show off their collections online, and Youtube is the best place to see the worlds best and biggest stacks. These online videos have grown in popularity in recent years, which supports the rising popularity of the silver precious metal and an ever-growing tech-savvy audience. It also enables stackers to retain anonymity through the use of different aliases to present their collection online. We've created a playlist of some of our favourite internet stackers from last year (take care not to get too jealous of some of these collections!)
Watch our 'Best of Silver Stacking 2018' Playlist
Guidelines For Being a Stacker
Everyone has their own style when it comes to stacking. We wouldn't want to tell you how you should stack your collection, but if you're new to the stacking game, there are some typical guidelines to follow.
As a silver stacker, make sure you do this:
- Buy from a reliable established bullion dealer
- Start with 1oz coins to ease yourself in
- Purchase regularly to avoid being caught out by fluctuations in the market
- Stack whatever is cheap
- Diversify your stack with silver bars in different sizes - 100g, 250g etc.
- Where possible bulk buy and save money (two of the same coin purchased together will often be cheaper than two different coins)
- Collect national mint coins – they are harder to counterfeit and easier to sell
- Avoid high premiums on overpriced coins
- Look out for deals & special offers
- Store your collection carefully and use gloves to handle your silver
- Know the silver content of the coins, catalogue your stack so you can keep track of how much you paid and when you bought it.
As a silver stacker, make sure you don't do this:
- Think you’re going to make mountains of money in the short-term
- Purchase from T.V. ads – you risk being ripped off
- Have too much of a product bias if you can't afford to
- Tell others that you keep gold and silver in your home, keep your stack safe and hidden
Accumulation target examples
Quite a few people like to have accumulation goals when it comes to silver stacking. Having personal targets ensures you maintain and add to your stack on a regular basis and allows you to get the best cost-average when split over a period of time. The targets set are really down to the individual and what they want to achieve.
Some stackers like consistency within their stack, some like as much variety as possible. If you're already a heavy stacker, you may have a lot bigger targets than a beginner stacker, but to get an idea, here are two typical target examples.
I'd like to accumulate the following weight of silver in my stack:
A total of 50 ounces in a year:
- 6 ounces in January
- 5 ounces in February
- 10 ounces in April
- 5 ounces in June
- 8 ounces in August
- 10 ounces in October
- 6 ounces in December
I'd like to specifically accumulate the following coins and bars in my stack:
A total of 100 ounces in a year:
- 17 x 1oz 2019 UK Britannia coins in January
- 15 x 1oz 2019 Australian Kookaburra coins in March
- 1 x 250g Baird & Co Bar in May
- 15 x 1oz 2019 Australian Kangaroo coins in July
- 6 x 2oz 2019 UK Queen's Beasts 'The Falcon' coins in September
- 1 x 250g Umicore Cast Bar in October
- 15 x 2019 Austrian Philharmoniker coins in November
- 20 x 2019 UK Lunar Pig coins in December
Collector or Investor?
An investor (whose intention it is to accumulate silver in the short-term and make a profit quickly) will have no product bias, just a bias towards the best price per ounce at the time. Many silver stackers - and many of Bleyer’s clients - like to be a bit of both. Collecting veers us towards our favourite bullion designs or nation’s coins, whereas investing allows us to see it's value for what it truly is as a precious metal.
When you're first starting off, you want to make sure you acquire as much weight over quality as possible. As your stack starts to grow, you could start exploring rarer bars or limited edition coins to add collector value to your stack. You may like the idea of diversifying into a couple of different precious metals at this point to balance your investment spread. Eventually, you may even end build up building your collection even more by exploring rarer gold proof sets and coins. Don't forget, silver can take up a lot of room so if you're stuck for space, why not consider getting some more valuable precious metals in there like gold, platinum or palladium.
The Growing Demand for Silver Stacking
Arguably, silver investment demand has receded a little since 2011 (when prices hit an all-time high), but the demand has been on the increase since then and is set to return, perhaps with force, over the coming decade.
A report on silver demand commissioned by The Silver Institute stated that investors worldwide could grow their aggregate holdings by 50% between now and 2024. This level of investing would be expected to push annual average silver prices to a fresh record high.
"With all due respect, you need to know that we do not invest in silver. We stack it." - Jeffrey Christian, The Silver Institute.
What the comment means is that silver investors in the developed West - whose demand has surprised analysts and defied the metal's 60% price-drop since 2011 – see the metal as a store of wealth an alternative to holding one’s wealth in a nationally issued currency. Instead of viewing silver as a speculative or short-term investment, these buyers see the metal as a core part of their long-term assets, the base in some cases of the individual's wealth; much more meaningful and visceral to the owners than shares in a stock or a series of bonds they may hold for a period of time.
- Silver is currently just 1/80th of the price of gold making silver very cheap to buy - MacroTrends
- "Silver supply may drop following mine closures" - Standard Chartered
- "Industrial demand will remain strong" - CPM Group
- "Silver is substantially undervalued versus gold" - FX Street
Stashing Your Stack
Keeping your stack hidden and a secret is a big worry for a lot of stackers. Secure and comfortable storage is as much a part of investing in Precious Metals as the purchase itself. It's particularly important to be mindful and considerate of quite a few things if you're planning on storing it all at home.
Here at Bleyer Bullion, we offer a huge variety of silver bullion in bar and coin form. If you would like some expert advice for storing stack, or what to get next, contact us today on 01769 618 618 or email [email protected]