Monday, February 03, 2014

Silver Panda Coins Outperformed Silver Eagles

Current year Chinese silver pandas usually sell for a few dollars more than Silver American Eagles.  For example, 2014 BU 1 oz Silver Eagles are currently retailing for about $6 over spot while 2014 Silver 1 oz Pandas are about $9 over spot (single coin price, excluding shipping).  This is because the China mint charges more for their coins than the US Mint, Panda mintages are lower, and demand for Pandas within China is seemingly insatiable

American silver buyers will sometimes shy away from Pandas because they don't want to "overpay" for silver bullion.  If you plan someday to melt your coins or trade them post-apocalypse, then by all means, spend as little as possible.  However, if you are looking for investment return, please take a look at the two charts below.

These charts show the current retail price of China silver pandas and US Silver Eagles (coins dated 2004 to 2014) on ebay and other mainstream retail websites (spot silver current near $20).  While the eagles certainly have tracked the price of silver, Pandas have greatly exceeded eagles at holding their US dollar value, despite the decline in silver prices in 2013.

So for example, a 2010 silver Eagle purchased in December 2010 would have cost about $30, and a 2010 silver Panda would have cost about $33. (spot was ~$24 at the time) Today the Eagle is worth about $27 while the Panda sells for about $40.

As you can see, silver eagles have not really appreciated vs silver, while pandas have continued to increase.

Dec 2010 PriceDec 2013 PriceGain
Silver Eagle BU$30$27-10%
Silver Panda BU$33$4021%

The reasons for this include low mintages and high demand for silver pandas.  In 2013, 8 million pandas were sold while the US Mint sold more than 40 million eagles!  In addition, pandas are widely viewed as more beautiful and collectible then their somewhat boring US counterpart.

Over the past 10 years (actually since 1983), Silver pandas have delivered a better US dollar return than other bullion silver coins.  If you are looking for a little extra zip in your silver investment, Chinese Pandas may be an good option.

With Silver prices at 4 year lows, perhaps now is a good time to consider stocking up on silver pandas.

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