What is Raw Silver? A Guide for Investors and Enthusiasts

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Raw silver refers to silver ores, which are sometimes called native silver. While nuggets of silver ore can still be found, they are increasingly rare. In fact, less-than-expected silver mining production in 2022 has led to diminishing silver supply across global markets. 

Although raw silver isn’t often considered an investment-grade asset, refined silver bullion bars and coins certainly are. Recently, the white glimmer of silver has caught the eye of investors the world over as both a hedge and growth asset for those looking to diversify their holdings.

In the world of alternative retirement investments, where traditional assets often struggle to offer protection against market fluctuations, inflation, and economic uncertainties, raw silver shines as a compelling option. Any retirement investor would do well to explore the potential benefits of including raw silver or refined silver in their portfolio.

Understanding the Appeal of Raw Silver

Raw silver holds intrinsic value and has been sought after for centuries as a store of wealth. Due to its unique chemical properties, silver has been used as a store of value for millennia—in fact, silver was first used to store wealth as early as 3,000 B.C.E. 

Unlike stocks and bonds which can be heavily influenced by market sentiments and economic conditions, raw silver’s value remains relatively stable over time, making it a reliable hedge against market volatility.

Source: InflationChart

 The chart above does a good job of depicting the relative price stability of gold. As a hard commodity with limited availability, silver supply shocks are not as pronounced as certain other assets. As such, volatile price swings are not as common as in indices like the S&P 500.

Chemical and Physical Properties of Raw Silver

Raw silver has a variety of unique physical and chemical features that make it a prized and valuable resource for the making of electronics, jewelry, and industrial products. 

Below are some of the unique attributes of raw silver.

Chemical Properties:

• Element Symbol: Ag
• Atomic Number: 47
• Atomic Weight: 107.87 g/mol
• Electron Configuration: [Kr] 4d¹⁰ 5s¹
• Oxidation States: +1, +2
• Reactivity: Relatively unreactive, doesn’t easily corrode in air or water.

Physical Properties:

• Physical State: Solid at room temperature (25°C)
• Color: Bright, metallic white
• Luster: High reflectivity, giving it a characteristic shiny appearance
• Density: 10.49 g/cm³
• Melting Point: 961.8°C (1763.2°F)
• Boiling Point: 2162°C (3924°F)
• Crystal Structure: Face-centered cubic (FCC)
• Hardness: Relatively soft with a Mohs hardness of 2.5 – 3
• Conductivity: Excellent thermal and electrical conductivity
• Malleability: Highly malleable, can be flattened into very thin sheets (foil)
• Ductility: High ductility, can be drawn into thin wires without breaking
• Transparency: Not transparent, opaque to visible light
• Solubility: Low solubility in water and most common acids

Other Properties:

• Isotope Composition: Silver has two stable isotopes, Ag-107 and Ag-109, with Ag-107 being more abundant.
• Abundance: Silver is relatively rare in Earth’s crust but is often found as a byproduct of mining other metals.
• Uses: Used in coins, jewelry, electronics, photography, mirrors, medical applications, and more due to its desirable properties.
• Allergenic Properties: Some individuals may develop allergic reactions to silver, particularly in jewelry.
• Historical Significance: Silver has been used for currency and ornamentation for thousands of years and has cultural and economic significance worldwide.

Appearance of Raw Silver vs. Silver Bullion

Raw silver ore typically has a distinct appearance that can vary based on the specific minerals and compounds present in the ore. 

Depending on the specific location and geological conditions, raw silver ore may be embedded in the host rock, which can range from dark-colored minerals like galena (lead sulfide) to quartz (silica) or calcite (calcium carbonate).

Silver ore forms as veins or patterns within the host rock. These veins can vary in width and may be more pronounced in certain areas of the ore deposit. The silver content in these veins can sometimes be visible as streaks or patches of metallic sheen. Silver ore can also crystallize, forming unique structures that contribute to its appearance. 

While raw silver ore may not have the dazzling appearance of polished silver, its distinctive color, metallic luster, and various associated features contribute to its recognition and identification by experienced prospectors and geologists.

Source: Chris Ralph

 The photo above displays native raw silver extracted from a mine in Norway. Notice its relatively dull and unassuming appearance in contrast to refined silver products such as coins and bullion.

Refined silver bullion or coins have a distinct and striking appearance:

Silver Bullion

Refined silver bullion is typically cast into bars or ingots. It appears as a polished, metallic silver with a smooth and uniform surface. The bars often feature stamped or engraved markings indicating the weight, purity, and sometimes the mint of origin. They are rectangular or bar-shaped, varying in size and weight.

Source: Blanchard Gold

Silver Coins

Silver coins have a circular shape and bear intricate designs on both sides. The designs can range from historical figures and symbols to national emblems. The obverse (front) of the coin often features a portrait or image, while the reverse (back) showcases a different design. The surface is usually well-polished, offering a reflective and lustrous appearance.

Source: US Mint Catalog

 In both cases, the refined silver’s high purity and meticulous craftsmanship contribute to its gleaming and visually appealing look. The beauty and utility of silver goods have led some investors to consider precious metals investing as a means of diversification.

Raw Silver Diversification and Risk Mitigation Benefits

The key to a resilient retirement portfolio lies in diversification. While gold is often the go-to choice for diversification, raw silver presents a more accessible and cost-effective avenue for investors to achieve similar benefits.

By including raw silver in your retirement holdings, you reduce your exposure to the risks associated with a single asset class, thus enhancing the overall stability of your portfolio.

Inflation Protection

Inflation erodes the purchasing power of traditional currencies and jeopardizes the value of your retirement savings. 

Raw silver, on the other hand, has historically retained its value during inflationary periods. Its scarcity and increasing industrial demand can potentially drive its value higher, acting as a powerful counterbalance to the eroding effects of inflation on your wealth.

Market Independence

The value of raw silver isn’t solely dependent on the stock market’s performance or the decisions of central banks. 

This independence is a crucial advantage, especially in times of economic uncertainty. When market crashes and financial crises occur, raw silver can act as a safe haven, preserving your savings from severe losses.

Silver’s Historical Performance

Looking back at history, raw silver has exhibited steady and appreciative growth. While its price can experience short-term fluctuations, its long-term trajectory shows a consistent rise. 

This steady appreciation can provide retirees with a sense of security, knowing that their investment has the potential to grow over time.

Tax Benefits

Raw silver acquired for investment purposes can offer tax advantages within a self-directed retirement account.  

By utilizing a self-directed Individual Retirement Account (IRA), you can invest in raw silver without incurring immediate tax liabilities, allowing your investment to grow tax-deferred until withdrawal.

Practical Considerations

When considering raw silver for your retirement portfolio, it’s essential to focus on purity and authenticity. Look for reputable dealers and certified products to ensure that you’re investing in genuine silver bullion. 

Additionally, consider storage options to keep your raw silver safe and secure, whether you choose a private depository or a home storage solution. Silver held within an IRA cannot be stored at home—only IRS-approved third-party depositories are allowed to hold IRA silver. 

Raw Silver: A Golden Opportunity for Risk-Conscious Investors

The inclusion of raw silver in your portfolio offers a unique avenue for diversification and wealth preservation. Its historical stability, potential for growth, and ability to counteract inflation make it a valuable addition to any retirement strategy. 

While raw silver is a relatively rare investment asset, refined silver products such as bullion, coins, and even “paper silver” securities provide exposure to this important asset. Those interested in reaping the benefits of physical silver and encouraged to consider opening a self-directed silver IRA with one of America’s top-rated silver IRA investment companies. 

By embracing raw silver, you can insulate your savings from market risks, economic uncertainties, and the erosive effects of inflation, ultimately securing a more resilient financial future. Speak to your financial advisor today about diversifying with silver assets.