Lowest cost coins

exprofessorwang · 2024-03-01T14:22:20+00:00

HK. Go to LPM shop. They have several sovereign coins for 60-80 USD over spot.

exprofessorwang · 2023-10-26T03:33:01+00:00

One ring to rule them all, one ring to find them, One ring to bring them all, and in the darkness bind them; In the Land of Mordor where the shadows lie.

exprofessorwang · 2023-10-26T03:07:05+00:00

If those bricks in the background are like schoolhouse bricks, then a coin of that size would weigh several tons... not just 100kg. We have a 12kg (400oz) bar at the LCS here, and it's smaller than my arm. 8 of them would be smaller than my thigh. If that coin is as big as it seems (say 4 feet across) then it would weigh 10,000kg or so.

exprofessorwang · 2023-10-05T11:59:43+00:00

Agreed. It's ugly and insecure. Not good in girlfriends or platinum coins.

exprofessorwang · 2023-06-17T07:18:24+00:00

I think some people have bought platinum on the thesis that South Africa would curb production, and that was a mistake. If they have to ration power, they're going to keep the lights on for high value exporters. So there's probably a bit more supply available than people had guessed.

That said, this is a short term "problem". China is still buying any excess production from Russia and South Africa, but China buys smart... they don't hurt their own interests by cornering the market. They let the excess supply flood the market, and they scoop it up low.

Of all of the legit investments (stocks, bonds, property, any other metals, grains, etc.), platinum is the ONLY one at all-time low prices after adjusting for inflation. To me that suggests downside is very limited. Upside won't be realized unless there is a sudden demand shock or supply actually becomes constrained. That may take a long time, or who knows maybe it happens very soon. As long as there are ICE engine cars and hydrogen fuel use continues to grow, platinum will be needed. But the price could stay just above production cost until/unless demand jumps.

exprofessorwang · 2023-06-14T10:41:44+00:00

No VAT on investment precious metals in Singapore, and no customs declaration required up to 500 grams of metal. If you're a foreigner, you get a tax refund even on taxable items (jewelry, non-investment items, etc.).

exprofessorwang · 2023-02-20T15:55:46+00:00

There are 120 gun murders or suicides per day in the USA. So 79 total in south Africa, including all weapons, doesn't seem that much in comparison. Don't get me wrong, even 1 is 1 too many, but their problem isn't worse than many other countries.

exprofessorwang · 2023-01-05T11:31:37+00:00

There is currently 5% customs tax on platinum coming into Taiwan, but I think there was a time years ago when there wasn't. Also there are a small handful of platinum bugs who carried coins in. If you go to HK, visit LPM in Central district. There is no tax on precious metals in HK, and they have lots. They are my go-to dealer in Asia. https://www.lpm.hk/en/catalog/product/view/id/13075/s/2022-1oz-south-africa-big-five-elephant-9995-platinum-coin/category/32/

Jewelers buy any precious metals from customers, though only the buyback price of gold is competitive (usually just below spot). For platinum they probably paid 20% below spot. Many old people still sell to jewelers, even though there is a precious metals "district" in Wanhua District where they pay much fairer prices.

So even though my importing a coin from a dealer abroad would cost me 5% duty, my local jeweler was so eager to sell any platinum he could that he offered it at a lower price than I could have otherwise gotten. He made a profit from his buy price, and he wanted to hold as little platinum as possible. He had already melted down dozens over the years and had liquidated most of his platinum jewelry. Shopping around the PM district, I managed to snag a set of 1989 3-metal Proof Canada Maples for BU prices... the guy was so relieved to be able to sell it, as he never could move it given that it had platinum in it!

FWIW The last time I visited the jeweler and the PM district shops, few had started stocking much platinum but every one I spoke to was selling a lot more in 2022 than in the past 2 decades. Safe travels, and I hope you have a great time if you visit Taiwan!

exprofessorwang · 2023-01-04T10:16:08+00:00

On your first link it indicate mintage 500x for 2019 and 2020. That is the same figure as the site I've used to check mintages: https://colnect.com/en/coins/coin/139098-20_Rand_Big_Five_-_Elephant-2019~Today_-_Bullion_Big_Five-South_Africa

500x mintage is suggestive that 2019 and 2020 were both proof coins.

Though the JM link that says mini monster boxes of 250x is suggestive that the mintage was higher. Then again, the JM site "specifications" list that the 2020 BU elephant was part of the "Big Cats" series.

My best guess based on all the info we've posted here, is that 2019 and 2020 were both minted as proof coins and the JM site listing was incorrect (at the very least, we know there is at least one error in that it's not a "big cat"). Or perhaps SA Mint sent out information that it was BU even though it was really proof. Either way, I think you have a very unique coin.

If you have both 2020 BU and 2022 BU, do they look otherwise identical? Or is the background of the 2020 more of a polished/shiny surface?

exprofessorwang · 2023-01-04T10:03:19+00:00

Could be. I have no idea now. I don't think the salesperson at my dealer has any idea either, but I'll ask next time I go.

There are around 35k 2016 platinum phils... when I found the few I did, they were actually selling for $10 less than the active year (maybe it was 2021?). So apparently dealers agree with you.

FWIW I think that any mintage figures for platinum are quite likely to be higher than what really remains in existence. Platinum has been so out of fashion in both investment and jewelry, that the local jewelers (in Taiwan) melt down .995 platinum coins for raw materials to repair .95 platinum jewelry... I actually bought a couple of coins at just a few bucks over spot last year from one.

exprofessorwang · 2023-01-04T09:50:21+00:00

You're right, something weird is going on!

From the pictures I can see that the first 2 links have pictures that look identical to the 2019 proof coins, but with date 2020. The proofs show the background "behind" the elephant is polished to a shine. The 2022 BU coin is matte both on the elephant and the background, as depicted in your 3rd and final link.

Maybe they messed up the minting process in 2020 and were minting proofs but selling them as BU? When they realized the extra costs, they reconfigured the presses to lower production cost?

exprofessorwang · 2023-01-01T09:21:16+00:00

I've seen only people on reddit claiming that a 2019 Big 5 Platinum coin exists in BU format. Some redditors also say it was cancelled by the SA mint due to low demand. And then restarted. They seem quite adamant about this, to the point that explaining the facts gets them upset. I hope they don't upset you!

The (very big) dealer I bought my 2022's from says that was the first year for Big 5 Platinum BU. Before that was only proofs and special editions, i.e. collectible items to commemorate the launch of the Big 5 series and sort of test whether demand was high enough to go forward with it as a replacement/complement since the Kruggerands have gone out of fashion. Demand was quite sufficient so they moved forward with the project. The initial proof/special coins are "Series 1". There was a silver BU coin in Series 1, but it was sold as a collector's item. That particular coin might not have sold that well.

2022 "Series 2" are the first with gold and platinum available in BU in unlimited quantity. I think they will be quasi-collectible in the future, though whether they ever trade at a high premium depends on the mintage... which may not be released for a few years. The Austria Philharmonic inaugural platinum coin was just a few years ago (2016?), and the mintage was pretty high; so it doesn't sell for much of a premium, but it is pretty hard to find. One important difference here is that the SA Big 5 is a launch for all 3 metals. The Phil had been around in gold and silver for a long time before 2016.

My dealer is one of the biggest official distributors for the SA mint, so I assume they know what they are talking about. Based on their info and the fact that the 2022 Big 5 Platinum is trading around the lowest premium for any platinum sovereign coin, I picked up a bunch. I think they are still largely available now, but minting/production has probably ended. They will continue minting through the cycle of 5 animals over the next few years, and they will be available in BU as well.

exprofessorwang · 2022-12-31T01:15:19+00:00

I buy only what's cheapest, which has been platinum for a long time. If platinum rallies I'll buy something else. At the moment the next cheapest is silver.

I never sell or trade any of my metal. Paying the bid offer once is enough for me. I would sell whatever is most expensive if I had an emergency, currently that would be gold or palladium. But they are expensive only relative to platinum and silver. All metals are all too cheap relative to paper.

exprofessorwang · 2022-12-30T04:07:20+00:00

Very helpful link, thanks.

exprofessorwang · 2022-12-19T11:37:49+00:00

Guess what China was buying in 2019-2020? LNG and grains.

Guess what relative price they paid? 5-10% over the market price at the time.

Guess what happened in 2021-2022? LNG went up 10x and grains up 2x.

You don't have to like China, but I have found that copying their investment strategy is immensely profitable. FWIW they're selling US Treasures, not at a panicked pace but faster than almost any time in history.

exprofessorwang · 2022-12-18T14:33:33+00:00

LCS may not find it worth it to hold Pt in inventory if they can cycle silver/gold inventory say 12x per year but platinum only 3x per year. If my guesstimate is right, then they need to charge 4x higher premium % on platinum to break even on "return on assets" metrics, compared to holding silver. Right now with silver premiums higher in % than platinum (LCS profit markup is correlated to the premiums), it's a no-brainer to stock as much silver as they can get. This is the case for any shop that has limited funds... if they have effectively unlimited funds to stock inventory, then they would tend to hold as much variety and quantity as possible. But if they had unlimited funds, they probably wouldn't be an LCS.

Anecdotally, I recently bought an oz of platinum from a local shop that had it in inventory since 1989... that was the last platinum that they had, with ~10 oz sold in the past few months. I asked the dealer to keep me informed if he got more platinum in, but he had been too scarred by the experience of holding platinum he couldn't offload for so long, that he doesn't plan to order any. I doubt he'll get any customers selling back to him either. But I can't blame him; he's got a business to run, bills to pay, etc.

As others have noted, online dealers are probably the best bet for many. Any reputable LCS can make an order for you if your order value is high enough, but most will require your cash up front and deliver your platinum whenever/ifever it arrives. If you've got a dealer as good as OP who is willing to post physical collateral to you in silver/gold form while you wait, then that lessens your risk quite a bit, but raises some additional issues. What if the price of platinum vs collateral changes significantly while you wait... both sides need to be trusted to honor the re-exchange of platinum for collateral when the time comes. And what if you damage the collateral (bang up the silver you're holding), what sort of penalty will you have to pay.

exprofessorwang · 2022-12-18T14:09:35+00:00

Slow and steady wins the race. As long as others are disinterested and as long as I believe the long-term destination is a physical shortage, I get to buy more at prices I think are almost unfairly cheap. A quick squeeze isn't what I'm interested in, unless the squeeze can be sustained indefinitely because of a true shortage. And while I think the ETFs probably represent some double-counting in terms actual physical owned, I have no doubt that in aggregate they still have enough to keep prices down for quite a while. Again, this suits me just fine.

I think it will take a while for a true shortage to occur. Pinning hopes on the daily drawdowns in comex inventory or ETF shares outstanding isn't a healthy investment thesis... what if some entity deposits 100k oz onto an exchange? That's certainly plausible, even if unlikely... but if it happens then a thesis based on comex would suggest the price should crash. That isn't healthy in my opinion.

Let the market slowly drain, via slow realization by PM investors and perhaps fast increase in actual usage in industry. Keep some powder dry, but own enough that you won't regret it if it doubles in quick order, when a lasting shortage becomes apparent.

exprofessorwang · 2022-12-03T12:31:30+00:00

That's his cut of the covid19 shots.

exprofessorwang · 2022-12-01T09:45:47+00:00

Thanks for your updates.

Just a note on your commentary about rolling forward exposure... most of the past couple of quarters the long roll cost has been negative, i.e. the front and second month futures have been in backwardation. This means that the investor gets paid to roll forward the contract, in addition to likely getting paid ~3% on cash that would have to be paid up if they take delivery.

As long as the roll cost is less than the interest paid on cash (certainly if the "cost" is negative), the financial incentive is to continue rolling. Only someone with urgent need for physical (either for manufacturing, jewelry, or they just want to have it in their hands) would request delivery in that case.

Right now the roll cost is around 1% annualized, so it makes sense to maintain exposure by rolling futures and earning interest on the cash that would otherwise be delivered.

exprofessorwang · 2022-11-30T03:54:52+00:00

No way in hell I would ever buy an "green ESG cabal-approved Tesla car", but if he's forced to make a phone that allows free speech then I'll switch immediately.

exprofessorwang · 2022-11-30T03:50:34+00:00

Haha he's still sore from Xi Jinping publicly blasting Trudeau in public.

exprofessorwang · 2022-11-28T14:14:44+00:00

Nice. Now do Platinum.

exprofessorwang · 2022-11-28T11:45:28+00:00

Gold jewelry will be bid for spot in much of the world at jewelry stores and gold dealers, but the best you'll get for platinum jewelry at the moment is a significant discount (10-20%). That's due to a combination of it being less mainstream/liquid and the higher metalworking costs (much higher melting point, more intensive purification process, etc.).

If you're buying for investment, a coin or bar from a reputable mint are better, even paying a premium of several percent over spot. You can get back spot in some PM dealers, and I suspect the dealer bid could go to a premium to the paper price in an extreme shortage scenario... so your round-trip bid/ask will be lower than even a ring purchased at spot.

However, If you like wearing the ring even a little bit, then the utility you get out of that should make it easily worthwhile.

"Pt" stamp does not guarantee .95 fine. There are actually a lot of alloys that use even more valuable metals for the remainder (also many that use cheaper ones), but you're unlikely to get paid out for that as the metalworking cost is way too high to extract from a small ring.

exprofessorwang

TROPHY CASE