How to Buy Silver Stocks

by Contributor ; Updated July 27, 2017

How to Buy Silver Stocks. Precious metals like silver not only make for elegant jewelry, they can also make for a good investment. While some purchase the silver bullion itself, a more traditional and familiar investment is silver stock. Rather than actually investing in silver a person would buy shares of the companies that reside in the silver industry.

Step 1

Establish the amount of money you wish to spend on the stock. When making any purchase it is extremely important that you construct a budget before any monetary outlay.

Step 2

Monitor the silver index which is a composite of precious metal companies. This index gauges the overall price level of the silver industry and gives you a basic idea of current market conditions in the silver industry.

Step 3

Develop a criterion to gauge in the investment value of these silver stocks. Whether it is profitability, revenue growth, debt to asset ratio or some other measure, you want to establish a baseline to use in comparing one stock to another.

Step 4

Use the criterion to choose a few stocks to investigate further. There are so many different companies in a given industry that you need to focus on a few stocks so you can properly determine which the best investment is.

Step 5

Set a price you want to pay for each silver stock that seems to be a sound investment. Once you determine that the company is financially sound, then decide how much per share of stock you are willing to pay given the current stock price.

Step 6

Buy the silver stock after you factor in your budget and the price per share you want to pay. You can purchase a silver stock through a broker or by using an online financial services company. Be sure to place a limit order, which allows you to establish the price you want to pay for a share of the silver stock.

Warnings

  • Before making any investment, you should consult an investment professional for confirmation on the financial soundness of the purchase.