Given all the uncertainty in the global economy - debt issues , easing programs, unemployment, etc.

Designed to protect against inflation and ambiguity in the markets, the asset class contains much appeal. As such, gold, silver and even platinum and palladium have now become portfolio staples. While there is much debate over whether or not, investors should even own precious metals at all, there is a much bigger debate a-brewing. Just how should they get that exposure?

The exchange traded fund ETF boom has allowed investors to get their metals fix via a variety of funds that either track futures contracts - like the PowerShares DB Silver NYSEARCA: DBS - or own physical bullion like SPDR Gold Shares NYSEARCA: Yet, there is strong vocal camp that believe that owning the physical metal, in a safe or bank vault, is the only way to go. Say Yes to the Funds Funds like the iShares Silver Trust NYSE: SLV have made it quite easy for regular retail investors to tap the silver market.

However, there are plenty of pros and cons that go along with that decision, rather than buying physical silver bullion. Unlike gold, which is seen strictly as a store of value , silver also benefits from its wide use in many industrial applications. The metal has established uses in the automotive sector , across various electronics products, in solar panels and in photography.

New technologies such as silver oxide batteries, silver conductive inks and various silver based nanotechnologies in medical applications are all quickly becoming standards in their industries.

The Best Way To Buy Silver | Investopedia

Given this fact, ETFs that track silver prices or futures could be a better bet versus physical bullion, as they can be sold quite easily if investors think prices are too frothy.

Then there are costs to consider. Buying physical bullion, of any precious metal, comes with added costs investors may not be thinking of.

For example, The United States Mint produces several silver bullion coins , with the most popular being the one-ounce American Eagle. Likewise, other coinage mints such as The Royal Canadian Mint also produce several silver bullion coins.

However, these coins carry a similar premium when purchased directly from the Mint. Third-party vendors also exist, but again, premiums to spot are prevalent. Then there are the storage costs to consider. For the cost of just one share that trades roughly at spot prices , and as little as 0.

Perhaps the biggest is the counterparty risk associated with owning one of the ETFs or perhaps even more for investors owning an exchange traded note ETNs like the UBS E-TRACS CMCI Silver TR ETN NYSEARCA: Shareholders don't actually own title to the metal itself, unless they are an authorized participant , if they go with an ETF. This fact underscores the number one reason why most investors choose precious metals in the first place: A perfect example of the potential problems with counterparty risk stems from the recent bankruptcy at MF Global in late The liquidating trustee in the court approved bankruptcy paid these investors about 72 cents on the dollar for their holdings.

Many of the physically-backed funds sell a portion of their bullion to pay for their expenses. Overtime, this has caused share prices to track less than spot. By the end of , the popular iShares Silver Trust corresponded to 3. The Bottom Line For investors looking to gain access to the silver markets, both owning physical bullion as well as purchasing ETFs have their pros and cons.

Basically, it comes down to what they are looking for.

If an investor seeks an easy and instant investment of silver, the funds come up shining. However, if a person truly believes that the financial system will collapse, physical silver is ideal alternative.

Maybe owning both would be the most prudent move.

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The Best Way To Buy Silver By Aaron Levitt Share. As the precious metal space has given up many gains in the wake of a strengthening global economy, silver remains a value. The metals industrial side will help propel it higher over the next Find out about the top ETFs that track the silver sector, such as the iShares Silver Trust ETF, ETFS Physical Silver Shares ETF and ProShares Ultra Silver ETF.

Find out what affects the price of silver, the types of investments that can be made and the methods in which it is traded. Silver Futures are becoming popular trading instruments. Here is a primer on how to trade them.

You can profit from the price movement of silver without physically owning the metal.

Four ways to trade silver using ETFs or stocks as it approaches a major support region. Physical gold and silver holdings are taxed when sold-- here's how the cost basis is calculated, and ways you can offset taxes owed. With silver on the move, gold could quickly become yesterday's news. After a stunning loss on Tuesday, silver is seeing a recovery on moderating U. Explore the various investment choices available for traders seeking to invest in the silver market, along with the advantages Discover investment opportunities with ETFs that invest in physical precious and base metals and miners such as gold, silver, Discover the other, lesser-known precious metals such as platinum and palladium, which are more tied to the industrial economy Learn about options strategies for the metals and mining sector, such as call and put options for gold exchange-traded funds, DBS , GLD , SLV , USV.

No thanks, I prefer not making money.

Top 3 Silver ETFs of (SLVP, SLV) | Investopedia

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