Silver

Silver is sometimes referred to as the common man’s gold, mainly because it is has often been much more attainable to acquire for the bulk of our global population than gold.

Some consider the purchasing of precious metals like silver and gold as an opportunity to gain entry into what could be described as true money, in other words, an actual physical store of worth which also holds an intrinsic value.

Today’s Silver Price

Having some silver in your investment portfolio is viewed by some investors as almost the ultimate insurance policy and an excellent hedge against painful periods of inflation, political instability and poor financial market conditions.

Although some of the what-if? scenarios might not materialise, it could still be argued that the potential benefits of having some exposure to silver in some way or another as part of your overall investment portfolio, will probably outweigh the cost involved.

More than just monetary value

One positive argument towards investing in silver is that it offers much more than just monetary value as it also has useful medical and industrial applications as well.

The chemical properties and molecular arrangement of silver make it arguably the most unique amongst all other elements found on earth, which makes it continued usage and applications as a compelling case to invest in its own right.

Silver is the most electronically conducive, reflective and thermally conductive element we know, and this has led to numerous electronic devices, medical appliances and numerous other indispensable items making use of this precious metal and becoming reliant on it as part of the manufacturing process.

Supply and demand

The fact that silver takes a prominent role as a useful industrial metal as well as a precious metal, bodes well for demand in the future, but there uncertainties surrounding the stability of future supplies.

It may appear that access to silver is plentiful when you look at availability in paper markets but the physical markets show a different picture and there has actually been a steady reduction in above ground inventories for silver compared to other industrial and precious metals.

The problem is that a large percentage of the world’s silver is mined in countries where there is often a combination of factors such as political instability, workforce disputes and a lack of economic development.

As demonstrated in the past, geopolitical instability can quickly escalate into significant strains on supply, which could be considered as a reason for investing in silver, especially if supply and demand imbalances create a spike in the price of silver.

Many reasons to own silver

You can actually find many compelling reasons why you should own silver but it should be pointed out that the price performance of this metal does not always reflect perceived upside of investing.

Silver is in great demand as an industrial metal, China is buying a lot of it to satisfy demand in relation to applications from medicine to jewelry, and miners are experiencing problems in finding new silver deposits.

All of these factors would strongly suggest that the silver price should be moving upwards at a healthy rate, but it has actually underperformed against other metals in recent times.

A percentage of experienced investors consider that it is only a matter of time before the price of silver responds to the various pressures that should in theory force its value to rise, but you will have to decide if silver is a good investment, which is a decision that is probably going to be influenced by how long-term your view on markets is.

How to invest in silver

We cover the different ways of investing in silver in greater detail elsewhere on the site, but the main ways that investors look to get silver onside is by acquiring some physical holdings or trading in related stocks or ETF’s.

ETF’s have proved popular with investors as a good way of gaining exposure to this metal and the Silver Trust (SLV) is a prime example, offering you the chance to invest in physical silver without the added complexity associated with silver exposure through futures or stocks.

There are are other investment platforms to consider such as Silver Miners ETF , Physical Silver Shares and DB Silver Fund. These are not recommendations to invest but should provide a good starting point when you are looking for a suitable investment vehicle if you decide to invest in silver in this way.

The other ways include buying stocks of silver mining companies or buying bullion. You can also use the futures market to gain exposure to silver or consider a more traditional route of investing in mutual funds with an exposure to silver and other commodities.

Read our guide to the ways you can invest in silver.

Uses of Silver in Industry

Silver is an extremely versatile and this white metal enjoys a very positive reputation within so many different industries.

Silver has been used for many years in order to produce jewelry and coins, but its predominant role in the modern world is in industry. You can find many examples of industries taking advantage of silver’s unique properties in order to help them produce a diverse range of products from cell phones to solar panels and plenty more besides.

silver-uses

What is interesting to note from the mineral commodity summary compiled by the United States Geological Society in 2013, is the fact that jewelry and silverware now forms a small part of current uses for silver and although coins and medals still account for 25% of silver use, electronics and electronics plus other (which includes industrial applications) are responsible for almost 70% current silver applications.

Overview

Silver is now considered a vital component due to its use in a wide range of industrial applications.

For example, electric power is considered to be a critical source of energy that powers global industry and this is made possible through the use of silver contacts in circuit breakers and switches.

These silver contacts in membrane switch panels are an integral part of control panels that are routinely used to control machinery and aid chemical industry processes as well as numerous other applications such as traffic controls and many more.

Silver is also very important as a power source, due to the fact that silver oxide and zinc batteries offer twice the capacity of lead-acid batteries and it also plays a pivotal role in radiography amongst other essential applications.

Electronics

The primary use of silver in an industrial application is in the electronics industry and one of the main reasons why it is viewed with such importance is that silver offers unrivalled thermal and electrical conductivity properties, making it irreplaceable even when there are less expensive materials available.

Small quantities of silver are used to create contacts in electrical switches and there are so many household and industrial uses for switches that we are all dependent on the use of silver to be able to create a contact that means your light switch or microwave turns on.

The automotive industry is also a heavy user of silver as many modern cars are laden with electronic features that are controlled by contacts using silver.

To be fully effective, electronics require silver that is of the highest purity and the silver bars or grains used are 99.99% pure and are also referred to as having a fineness of 999.9.

The pure silver is dissolved in nitric acid and these produces silver nitrate, which can then also be formed into a silver powder or flakes. Once the silver is in this state, it can subsequently be fabricated into contacts or silver paste, which has many uses.

Energy

We are all looking at ways to improve energy efficiency and use natural resources, and silver paste is used as part of the process to create solar panels.

The silver paste contacts that are printed onto photovoltaic cells are able to capture and then carry the electrical current that is produced when energy from the sun impacts the semiconducting layer of each cell.

Not surprisingly, one of the fastest growing uses of silver is with photovoltaic cells and in addition to this, the reflective properties of silver allows it to reflect solar energy into collectors that use salts in order to generate electricity.

Medicine

Silver is important in medicine as it offers antibiotic properties but is also non-toxic.

This works by silver ions acting as a catalyst by absorbing oxygen and subsequently killing bacteria by interfering with their respiration process. Before the advent of antibiotics, silver foil used to be wrapped around wounds to aid the healing process and whilst silver is not toxic, repeated intakes of small amounts over time can result in argyria.

This is why the modern role played by silver is centered on antibiotics and includes other applications such as using silver sulfadiazine to kill bacteria in burn victims and using silver ion treatments to heal bones and encourage regeneration of damaged skin tissue.

Water, food and hygiene

The antibacterial properties of silver have been in use for hundreds of years and silver containers used in the past to prevent spoilage of liquids, have now been superseded by the use of a silver coating that is able to prevent bacterial build-up in carbon-based water filters.

It has been found that silver-copper ions are capable of replacing chlorine to sanitize pools and tanks and the antimicrobial properties of silver also make it useful in food and hygiene applications.

Nanosilver is routinely applied to food packages and refrigerators these days and there are a growing number of consumer products that make use of the benefits of antibacterial silver.

Engine component

Silver is a vital component in engines and engine bearings rely on steel that has been electroplated with silver in order to be able to withstand the high temperatures created by engines.

Silver is also able to act as a type of lubricant which helps to reduce friction between a ball bearing and its housing and research is also currently underway to see if silver can act as a substitute for platinum in order to catalyze oxidation of matter collected in diesel engine filters.

Many other uses

Silver has almost countless uses and there are still plenty of examples of traditional applications still playing a role in today’s world, such as using silver as one of the ingredients in the amalgam that is regularly used to fill dental cavities.

Silver is also continuing to replace other materials and also be applied to a number of new uses.

A good example of this would be the use of silver to replace toxic chromated arsenate as a wood preservative and silver-based ionic liquids can be used to clean up petroleum waste products.

Silver offers unique properties and in particular, the fact that it offers high thermal and electrical conductivity, excellent reflective qualities and antibacterial properties, means that silver will continue to play a dominant role in industry and help to make our living standards and health better.

The Ultimate Guide to Silver Hallmarks

Trying to identify or value a piece of silver jewellry or a silver antique item can be quite daunting and difficult for anyone who is not an expert, which is why the sight of a hallmark often brings a sense of relief that you are going to get a valuable clue.

A hallmark takes away a certain amount of guesswork that would otherwise be needed and getting to grips with how to identify hallmarks is an integral part of becoming more knowledgeable about items crafted from silver.

The first thing to point out is that there is a general misconception about what a hallmark is and what it stands for. This is because many people make the same mistake of confusing hallmarks with makers marks.

A hallmark should simply be viewed as a useful indication of metal content together with a guarantee relating to the purity or quality of the silver you are inspecting. The confusion arises because a makers mark and other identifying marks might be included within the hallmark inscription, but a makers mark on its own should not be considered as a hallmark itself.

Hallmarks are most commonly found on precious metal objects and some pieces of jewellry are actually exempted from hallmarking under some specific circumstances, so the fact that a hallmark is missing might not always mean that the item is of inferior quality.

Thankfully, for those of us who are not silver experts, the greater majority of silver pieces which have a value, do have a hallmark. When you find a piece of jewellery that is hallmarked, it is a mark that is going to be very helpful in providing some vital clues so that you can pinpoint its country of origin, and indication of the metal content and sometimes, its date of manufacture will also be incorporated within the hallmark.

British and worldwide hallmarks

The concept of hallmarking and the word hallmark originates from London, where the London Goldsmith’s Hall of the Worshipful Company of Goldsmiths first created this system of identification.

The Worshipful Company of Goldsmiths are more generally referred to as the Goldsmiths Company and has been responsible for testing the quality of gold and silver since 1300. All of these centuries later, the Goldsmiths Company still plays a pivotal role in the precious metals industry and also provides a centre of excellence where silversmiths can learn and perfect their trade.

The company still maintains a record of all British hallmarks and most European countries also use a system of hallmarking as an important method of identification and as a way of establishing provenance.

Every country has their own variable on the system of hallmarking although one notable exception is the United States of America, where they have never adopted hallmarks and use their own methods to indicate fineness or karat content.

As you will discover, some countries have a very simple hallmarking method in use whilst others, such France for example, operate a complex system that requires a fair degree of interpretation.

British hallmarks

Some might consider that the British way of hallmarking is quite challenging and complicated to comprehend but once you understand how to decipher the system ,everything else falls into place.

British hallmarks include a fineness or purity mark as well as an assay office mark, a date letter and sometimes a makers mark too, although this is not always present. The assay office mark is compulsory and as you will see from the assay office guide, it uses the lion passant for 925 silver, the Britannia mark for 958 silver and the date letter in all cases are voluntary additional marks.

if you are dealing with English silver, the walking lion (lion passant) together with the number 925 signifies that you are dealing with sterling silver and the Britannia 958 marking is an indication of a higher silver standard, but this hallmark has not been used since the reinstatement of the sterling silver standard in 1720, so you are more likely to be looking at a hallmark that contains the 925 number than the Britannia 958.

  • The five standard marks found on British Silver
 are:
  • The walking lion for all sterling silver made in England
  • The standing lion for all sterling silver made in Edinburgh
  • The thistle for for all sterling silver made in Glasgow
  • The crowned harp for all sterling silver made in Dublin
  • The image of Britannia for Britannia standard silver

Assay offices are authorised to award hallmarks and you should be able to identify which assay office has issued the hallmark by deciphering the image contained in the hallmark. The mark of London is a Leopard’s head, the mark for Birmingham is an anchor and if you find a shield with a sword and three sheaves of wheat , this is for the Chester assay office, which closed in 1962.

Here are the hallmarks you will be looking at for United Kingdom silver:

Image source: http://www.assayoffice.co.uk/our-services/uk-hallmarks
Image source: http://www.assayoffice.co.uk/our-services/uk-hallmarks

In addition to the assay marks you will find information in the form of date letters that will enable you to age the piece of silver.

Each assay office operates its own cycle of hallmarks and will include a letter of the alphabet for each year, although the letter J is sometimes omitted from the A-Z cycle. The style of the lettering and the shape of the reserve or shield background varies with each alphabetical cycle. You will therefore find that a letter will be either upper or lower case and the typeface will also differ according to which cycle the silver was hallmarked in.

Image courtesy of governmentauctionsuk
Image courtesy of governmentauctionsuk

Unless you have an encyclopedic memory, the best advice is to get yourself a pocket-sized edition of British hallmarks so that you can look up the date letter and with a bit of regular practice, you will soon find interpreting British hallmarks easier than you first imagined.

French hallmarks

If you struggle to interpret a French hallmark you will not be alone. Many experts even consider that their system of hallmarking is the most complex system that you are likely to encounter and if someone who earns a living dealing with silver antiquities finds it challenging, a novice is definitely going to need some help.

The professional advice is to acquire a copy of Tardy’s Hallmarks on Silver , which is a comprehensive guide to hallmarks in general and has done an excellent job in deciphering the markings found on French silver.

For basic guidance, the most common hallmark you will find on French silver is a boar’s head, which is the mark of the Paris Assay office. This is an indication that the silver has a fineness of 800 or above and applies to items like jewellry.

You might also find a crab mark, which was used outside of Paris between 1838 and 1961 but was subsequently adopted and used by the Paris office since 1962.

Other notable European hallmarks

You can take a look at a resource such as this online encyclopedia of silver marks and hallmarks for a comprehensive guide to all of the hallmarks adopted by nations of the world and there is also a forum where you can ask for help if you are finding it difficult to identify the hallmark of a particular item of silver.

In general, many European countries mark their silver and gold with numerical fineness marks that operate on a similar concept to the British hallmarking system outlined already.

You will therefore encounter silver fineness marks in thousandths such 800, 830, 900 and 935 amongst others. You will also find other symbols are used in combination with the numbering system.

Russian silver uses a double-digit zolotnik, which is a unit of weight. This converts into thousandths, so the number 84 converts into 875 silver and you can sate the silver by working on the fact that between 1896 and 1908 the national mark was the left profile of a woman’s head wearing a diadem and from 1908 to 1917, a right-facing profile of the woman was then used.

After the Russian Revolution, the woman was replaced with a right-facing worker with a hammer and the finesses was expressed in thousandths.

You should  be able to use the online resources provided in this guide to identify most silver hallmarks with relative ease.

American hallmarks

As pointed out earlier, the U.S never adopted a hallmarking system but as a result of the perceived association of British sterling silver with quality, you will find that some American manufacturers took it upon themselves to emulate the British hallmark.

The U.S government nationalised the sterling standard in 1906 but American companies were making sterling objects and silver long before this date, which means you will encounter items that contain a makers mark that is remarkably similar to a British hallmark.