Hit the Spot
Stacking gold and silver without overpaying
I mistrust the government generally. In particular I mistrust its willingness and ability to forge monetary and fiscal policies that maintain the value of the US dollar. To that end, I diversify my store of value with both crypto and metals. But I’m not interested in paying for it, at least not overpaying. I try to load up when the spot price of gold and silver are low, but also try to avoid paying a premium to spot. Here are some ways to do so.
I’ll start with the simplest: buy Sprott Physical Gold and Silver Trust (CEF) for a 5% discount to NAV. It is a secure, convenient, exchange-traded way to own physical gold bullion. It costs 0.41% in fees which is less than it would cost you to adequately secure and insure significant quantities of gold and silver.
But what if you want to stack it yourself? While it isn’t scalable, take advantage of promotions offering gold and silver at spot. This has all of the advantages and disadvantages of being responsible for storage but also having immediate access to it.
There can be good opportunities to buy from the US Mint on occasion. Enthusiasm for collectibles comes and goes, but I never have any and, all else being equal, would prefer to be as asset light as possible. So I only buy to sell at a profit. The easiest way to do so is to join a buyer club such as PFS that repurchases certain Mint coins at a premium.
Walmart (WMT) sells gold at fairly low premiums above spot, which wouldn’t interest me except when I can get WMT purchases at a discount. For example, they offer gold for $2,683.10 per ounce which doesn’t interest me with spot at $2,635.57. However, I can use my Robinhood (HOOD) gold card to buy WMT gift cards and get 3% cash back with that purchase. I can buy the cards on Pepper (get $20 back with sign up code 586145) which has offered as much as 10% back on their cards. Net, I’m paying $2,334.30 per ounce for gold or an 11% discount to spot.
It makes sense to own some gold and silver, which have been used as money for millennia. But it never makes sense to overpay for anything. So pick your spots and pay less than spot.
