Is This the World's First Silver Backed Bond?
Commodities / Gold and Silver 2011 Aug 03, 2011 - 01:14 AM GMTFirst, let me start by saying that I am not affiliated with Royal Silver Company, nor do I endorse their products. However, the company has a rather unique opportunity that investors may want to research.
Royal Silver Company is a Panama corporation with a wholly-owned subsidiary in Bolivia. The company uses an advanced hydro-metallurgical method for producing silver from mined ores. Furthermore, the company uses zero emission technology in order to produce certified .99999 silver. The company currently employs about 75 people.
The company has a new limited membership opportunity for silver. Royal Silver Company is offering 400 memberships at a cost of $5,000 each, as long as spot silver is between $35 and $40. The cost of membership climbs to $5,625 if spot silver is between $40 and $45. Each membership acts like a bond, a silver bond. Each silver bond entitles the holder to receive a 1 oz silver coin each month until the silver bond matures in 2 years (24 total silver coins). Upon maturity, the holder receives their initial dollar investment back. This may appeal to investors, because it is rare to find an investment that pays you interest or dividends in physical silver (NYSE:SLV). However, the downside of course is that the initial payment is paid back after two years in U.S. Dollars (NYSE:UUP). The company’s website contains more details and even explains that investors can sell their membership back to Royal Silver Company anytime before the 2 year maturity is due.
This sounds like another too good to be true investment, but investors can check it out for themselves at Royal Silver Club. Perhaps Royal Silver Company will even inspire other companies to offer payment methods in precious metals (NYSE:DBP).
Investors looking to hold metal miners instead of a silver bond in their portfolio may want to consider gold plays such as AngloGold (NYSE:AU), Newmont Mining (NYSE:NEM), or Market Vectors Jr Gold Miners ETF (NYSE:GDXJ). Silver miners include First Majestic Silver (NYSE:AG), Endeavour Silver (AMEX:EXK), and Global X Silver Miners ETF (NYSE:SIL).
For more analysis on our support levels and ranges for gold and silver, consider a free 14-day trial to our acclaimed Gold & Silver Investment Newsletter.
Disclosure: Long AGQ.
By Eric_McWhinnie
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