With the growing concern over the future of the US dollar, and global inflation more generally, owning physical gold and silver is a wise insurance move. Owning gold stocks can be part of that strategy, as they soared during times like the Great Depression. Here’s a quick compilation of some basic starting points for those interested in investing in silver stocks.
There are many ways to invest in silver, including ETFs, mutual funds, buying physical bars, etc. This post will just focus on large-cap silver stocks for simplicity. In another post I’ve looked at some junior silver producers specifically.
Some of the Largest Silver Producers
Penoles – (Mexico) – Since 1887. One of Mexico’s largest exporters. The world’s top producer of refined silver. Owns the world’s largest silver mine, plus Mexico’s largest gold, lead and zinc mines. Has been listed on the Mexican stock exchange since 1968 as PE&OLES.
Grupo Mexico (GMexico) – (Peru, Mexico) – Since 1978, originally as GIMMEX. Owns largest mining company in Mexico. Trades OTC as GMBXF.
BHP Billiton – (Australia, UK) – In 2001, Australian resource company BHP Limited bought the UK mining company Billiton plc. As a result of the acquisition, the company is listed on two exchanges, one in Melbourne (as BHP Billiton Ltd) and one in London (as BHP Billiton plc). This will explain the difference in the shares’ tickers when you go to buy them. Other than this, as far as I know there is no difference between the Ltd (NYSE: BHP) and plc (NYSE: BBL) shares. It’s the same company. I am not sure why the share prices diverge; it must be related to currency exchange rates.
KGHM Polska Miedz – (Poland) – Founded in 1961. Specializes in copper and silver. Trades as (OTC : KGHMF) and (OTC : KGHPF)).
Volcan Compania Minera – (Peru) – Founded in 1943. Also mines lead, zinc and copper. Listed on la Bolsa de VALORES Lima (Lima Stock Exchange) and traded also on the Madrid stock exchange. Their website is primarily in Spanish, with some English. Traded in the US as (OTC: VCANF).
Rio Tinto – (Australia, UK) – Mines pretty much everything: copper, gypsum, diamonds, gold, coal, nickel, potash, lead, iron ore, bauxite, aluminum, uranium, talc and salt (they are the world’s largest salt exporter!). As with BHP Billiton, since 1995 Rio has been a “single economic unit” and headquartered in two cities – the same cities: in Melbourne as Rio Tinto Limited, and in London as Rio Tinto plc. You might want to wait before buying, however. The ADR share price (which is a purchase of the plc shares) is one of the highest I’ve ever seen, at about $431.00 USD.
Of these companies, only BHP and Rio pay dividends. Rio pays twice a year, BHP once a year (their next payment is September 25). Recently, BHP Billiton has offered to buy Rio Tinto (3.4 Billiton shares for each Rio share). If it goes through, this would be a massive acquisition and BHP would become, by far, the world’s largest resources company. Billiton also recently snapped up one of Canada’s few junior potash production companies. If it were me, I’d go with Billiton.
Investing in Bullion
Top Gold and Silver Dealers – Invest Directly In Bars and Coins
GoldMoney: Another Way To Buy Gold Online
Buy Gold Online Through Scotiabank’s New eStore
The New Gold Standard? Gold Will Help Replace the USD as Reserve Currency
Investing in Gold Stocks
Top 20 List of the Largest Canadian Gold Stocks
Gold Dividends: 11 Mining Stocks That Pay Them
Is $1000/oz. A Good Time To Buy? (includes list of the common gold ETFs)
Should You Invest in Bullion, Gold Stocks, or Gold ETFs?
World’s Largest Gold Mining Stocks
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