What Is the Bid-Ask Spread?
When trading silver bars, you encounter two prices: the ask (what dealers charge when you buy) and the bid (what they pay when they buy from you). The difference, known as the bid-ask spread, represents the transaction cost.
Understanding spreads is essential for evaluating the true cost of silver ownership. A 100 oz bar purchased at 3% premium and sold at 1% discount requires silver to appreciate 4% just to break even.
100 oz bars typically enjoy competitive spreads due to their popularity and the efficient market for this size.
Factors Affecting 100 oz Bar Spreads
Brand recognition significantly influences spreads. Bars from recognized refiners trade efficiently. Unknown brands may face wider spreads and authentication requirements.
Market conditions affect spreads. During volatility or supply stress, spreads can widen. Calm, stable markets produce the tightest spreads.
Dealer selection matters. Work with dealers experienced in silver bars for best pricing. Compare quotes from multiple sources.
Calculating Your Break-Even
Before purchasing, calculate the price appreciation required to break even after accounting for the full spread. If you pay 3% over spot and expect to receive 1% below spot when selling, you need 4% appreciation to break even.
For a 100 oz bar at $6,682, that 4% represents modest silver price movement, which is quite achievable over typical holding periods.
Continue learning about 100 oz silver bars:
For more detailed information and current pricing:
Monex live silver prices