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Patrick Yip: Silver Premiums Continue to Climb

Tom welcomes back, Patrick Yip, to the show. Patrick is the director of business development at APMEX, the largest precious metals’ dealer in the United States.

APMEX gets plenty of gold buyers, and that’s probably due to APMEX’s size and reputation. Today, they are seeing more silver buyers. Customers may be feeling that silver is undervalued at current levels.

Premiums remain high and are likely to stay high for a while. Supplies from the U.S. mint are limited, as blanks are difficult to obtain for production. APMEX is paying high premiums for some Silver Eagles, which they have to pass on to the customer. They are having to source from wherever they can get supply. 1000 oz delivery bars are also seeing higher premiums and delivery costs have risen.

Patrick explains why more customers are now buying and how changes in the spot price tend to attract buyers. Summer months tend to be slower for precious metals and also periods where the price is consolidating.

He discusses the differences between ETFs like GLD and SLV. These services don’t give you direct ownership of the actual metal, and they normally settle in cash. Also, you don’t know if ETFs actually have the metals in a vault as there are third parties involved. ETFs like the Sprott PSLV are much better because they are directly backed and audited.

APMEX wanted to make their own products, and the best way they found was to create their own mint. The 9Fine Mint allows them to make their own high-quality products and compete on price. Some of the products have their own collector value and can trade at a premium.

Patrick recommends avoiding high premiums on products. Look for items with low premiums like bars or use their OneGold service and take delivery later when premiums are lower. Dollar cost averaging is also a good way to begin building a physical metal portfolio.

Talking Points From This Episode

  • APMEX’s customer survey results.
  • Premiums and higher costs due to shortages of blanks.
  • The caveats of using some ETFs.
  • General advice for new investors in the metals space.

Time Stamp References:
0:00 – Introduction
0:33 – Demographics Survey
2:00 – Gold & Silver Demand
3:24 – Silver Supply
8:10 – Buyers Vs. Sellers
9:13 – Volatility & Spot Moves
11:05 – Portfolio Weightings
12:46 – Gold & Inflation
13:47 – Wholesale Gold
17:02 – Silver & Premiums
19:07 – Metal ETF Concerns
23:36 – How APMEX Hedges
28:13 – The 9Fine Mint
29:48 – New Products
32:04 – New Investor Advice
33:23 – Wrap Up

Guest Links:

Patrick Yip serves as the Director of Business Development at APMEX, and currently manages the fast-growing digital precious metal platform,, which has processed over $650MM in transactions during its first three years in business. Mr. Yip joined APMEX in 2011 and has held roles in Merchandising, Sales, Project Management and Business Development. He played a key role in the company’s 250%+ growth on marketplaces such as eBay, Amazon and Walmart. Before APMEX, Patrick has held roles at asset management companies, and at Fortune 500s, such as Disney and Twentieth Century Fox.

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