Silver price discussion and analysis

CCU, SVL, AYN ... I get the feeling these three codes will come up very frequently on stock discussion boards over the next several months. Silver (priced in USD) has recently broken out to fresh 30 year highs as the precious metal bull market kicks things up a notch, Gold has surpassed $1300 to reach new highs, the HUI is approaching the high of 519 set in March 2008, all signs are pointing towards an explosive end of year for the metals & related stocks.

During periods of high interest in precious metals Silver tends to outperform Gold as do the mining stocks, so you can just imagine the interest we could see in Silver mining companies, especially if Silver climbs in a parabolic fashion as I suggested it might in another recent post: "Where to for the price of Silver?".

The Gold:Silver ratio is still around 60:1. Before the 2008 collapse in precious metals prices this ratio was sitting around 50:1. A 50:1 ratio today based on the current Gold price would give us a Silver price over US$26.

Australia's large Silver producers do not do so as their main focus ... so finding exposure on the ASX to Silver's price upside can be difficult. To my knowledge there are currently only 4 "pure" Silver companies on the ASX (by pure, I mean Silver production or exploration is their main focus). One of those companies (CXC, Coeur D'Alene Mines Corp) is delisting from the ASX in December this year. That will leave us with 3, which brings us back to the codes listed at the start of the bog ... CCU, SVL, AYN, these are the 3 ASX codes for the following companies:

Cobar Consolidated Resources Limited (CCU)
Silver Mines Limited (SVL)
Alcyone Resources Limited (AYN)

Below is short introduction I have written for each, I will hopefully find time to cover each of them in more depth in the near future.

In my opinion the real speculative money has not really caught onto Silver's rise, as Silver rises further I expect these 3 companies will benefit handsomely through a significant rise in their share prices.

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hobo-jo said:

Australia's large Silver producers do not do so as their main focus ... so finding exposure on the ASX to Silver's price upside can be difficult. To my knowledge there are currently only 4 "pure" Silver companies on the ASX (by pure, I mean Silver production or exploration is their main focus). One of those companies (CXC, Coeur D'Alene Mines Corp) is delisting from the ASX in December this year. That will leave us with 3, which brings us back to the codes listed at the start of the bog ... CCU, SVL, AYN, these are the 3 ASX codes for the following companies:

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nukz said:

I'm not really any silver expert i'm more gold/cfd's but i'm looking at silver as well these days(who isn't). I'm looking at stocking up on some physical silver bullion but i had a question regarding assay's for silver but coudnt seem to find much information online.

For gold assay's are almost a must for physcal bullion but for silver(i'm looking at PAMP suisse 1kg bars) should they all have Assays?

This may sound silly but i'm abit new to silver.

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skcots said:

The PAMP bars I bought did not come with Assay Certificates. I didn't think much of it at the time as they were from a reputable dealer, they are well known bars and are stamped with purity and serial number. That said I know other places sell the bars with certificates.

Not sure if their will be any problems offloading them.

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skcots said:

The PAMP bars I bought did not come with Assay Certificates. I didn't think much of it at the time as they were from a reputable dealer, they are well known bars and are stamped with purity and serial number. That said I know other places sell the bars with certificates.

Not sure if their will be any problems offloading them.

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ETFS Physical Silver

Investment objective
ETFS Physical Silver (ETPMAG) is designed to offer investors
a simple, cost-efficient and secure way to access the
precious metals market. ETPMAG is intended to provide
investors with a return equivalent to movements in the silver
spot price less fees.

About the security
ETPMAG is a transferable security that can be created or
redeemed on demand by market-makers, and that can be
redeemed by investors. It trades on exchange as an equity.
ETPMAG is backed by physical allocated metal held by the
Custodian (HSBC Bank USA N.A.). All physical silver metal
held with HSBC conform to the London Bullion Market
Association’s (LBMA) rules for Good Delivery.

Key features

Tracks the price of silver, not a portfolio of equities

Simple to trade on a major stock exchange

Settled and held in ordinary brokerage accounts

Transparent tracking with clear pricing

Backed by physical, allocated metal

Provides additional portfolio diversification

Able to short, and margin eligible

About the pricing
The price of ETPMAG is based on the spot price of silver less
the daily Management Fee. Daily price of ETPMAG:
= 1.0 oz of Silver x Silver spot price
less daily Management Fee

Details regarding the pricing calculations are available on
http://www.etfsecurities.com/msl/index_au.asp
The spot price for silver is based on the LBMA’s specifications
for Good Delivery (loco London), which is an internationally
recognised and transparent benchmark for pricing physical
silver.

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