What has your experience been buying secondary market silver bars?

PerryHall

I bought two 100 oz Engelhard silver bars from a well known precious metals dealer. Since Engelhard stopped producing silver bars in the 1980's, all their bars are secondary market bars meaning that they have been previously owned. The bars were priced at 89 cents over spot. The bars I got looked like they were dragged behind a pickup truck down a gravel road. I'm sure they had full weight and fineness of silver but I was a bit disappointed that they were so beat up. Since I was buying them from a large dealer I didn't have the option of inspecting the bars before buying them nor could I specify the style of bar that they would grab out of their inventory. The bars I got were the later style extruded bars with the sharp corners. What has been your experiences buying secondary market silver bars?

derryb

I personally only buy new bars from primary wholesale dealers. The little extra premium gives me the piece of mind that I am getting the real McCoy.

mrpaseo

I'm still sitting on 1oz and smaller, it will be some time before I dip into the 100 oz market. That said, I am a bit picky and would want something half way decent. Dropping that kind of doe on a 100 ozer would make me want to see it in hand first. That said, .89 over spot is a pretty good price is it not? You may have to sell it at that same amount (Under a buck over spot) due to it being beat up.

Any chance we can get some pics?

Best.

PerryHall

<< <i>I'm still sitting on 1oz and smaller, it will be some time before I dip into the 100 oz market. That said, I am a bit picky and would want something half way decent. Dropping that kind of doe on a 100 ozer would make me want to see it in hand first. That said, .89 over spot is a pretty good price is it not? You may have to sell it at that same amount (Under a buck over spot) due to it being beat up.

Any chance we can get some pics?

Best. >>



No pics since they are in the SDB. The smaller secondary market bars seem to come less beat up compared to the bigger bars which makes sense. Agree that the price is good and I have no worries about getting my money out of it when it comes time to sell. All the major bullion dealers that I'm aware of make a two way market in the bullion products that they sell.

Baley

I've mentioned a number of times that I believe "premium" price of physical over spot is due to being "pretty" or "rare", and/or wanting to buy it Where and When you want it, especially in small quantities, such as individually handled ounces or tens of ounces with cute designs

and that common ugly silver is available all day long at prices very close to spot if you're willing to take what you get as long as it's real metal, in larger lots

A beat up Engelhard 100 oz. bar falls in the second category, it's a "pure silver" play without much collector premium attached, if any.

Such metal is probably better off melted down and formed into novelty products, except there is now a dearth of such material due to overproduction the past couple years.

CaptHenway

When I was working in the store, "beat up" did not matter on top name 100 oz'ers such as Englehard and J-M. We bought 'em at the regular price and sold 'em at the regular price.

Weiss

That same scenario has never happened to me, but I know how I'd feel about it: disappointed. And life is too short for that type of disappointment.

Also, are they the horizontal extruded bars? Those were the ones that were featured in that drilled & filled video--where the ends had been cut off, the interior drilled out with three big drill press channels, the interior filled with some other metal or compound, and then the ends soldered back on.

The day I saw that, I sold my two similar bars.

Not saying anything can't be faked or filled, but those bars seem pretty well suited to the exercise.

My stack is probably 75 or 80% secondary market--exclusively top tier but older bars bought from my dealer or other locations and not from the refiner itself. I wouldn't change that: I like the older bars and the prospect of at least a little higher premium or a quicker sale when it comes time to sell.

But if I had any bars that I was unsatisfied with, I'd sell them and move to something I do like.

FWIW: I have several 100 oz bars, but I doubt I'll ever buy more of them. They're just not as liquid, fractionable, and they seem like an easier target for fraud.

mkman123

I would stick with bars that were smaller in size and don't want anything with massive dents, etc.

Baley

Wow, that's actually a good point, it hadn't occurred to me that the bars might have been damaged intentionally to cover up the seams and other evidence of tampering.

Think about it: why and how do 2 100 oz bars get so extensively damaged anyway? " looked like they were dragged behind a pickup truck down a gravel road." Both bars?

they must have had a shared history to have the same resultant appearance and be together still. Perry, do you have pictures of the bars?

PerryHall

<< <i>Wow, that's actually a good point, it hadn't occurred to me that the bars might have been damaged intentionally to cover up the seams and other evidence of tampering.

Think about it: why and how do 2 100 oz bars get so extensively damaged anyway? " looked like they were dragged behind a pickup truck down a gravel road." Both bars?

they must have had a shared history to have the same resultant appearance and be together still. Perry, do you have pictures of the bars? >>



No pics since they are in the SDB. I may have been exaggerating a bit when I said they looked like the were dragged behind a pickup truck down a gravel road but they had a lot of scuffs and dings. They appeared to have been roughly handled over to years with little or no care and appear to have been carelessly tossed around. Lets face it---these bars were considered to be just bullion to be eventually melted down by industry to make jewelry, tableware, electrical devices, etc. These bars were never treated as some kind of collectible. Check a few pics of 100 oz bars on eBay and you'll see a few that look similar to my bars.