The first silver bond in nearly 200 years offers a 12% return on silver, paid in silver.
Monetary Metals has launched the first silver bond in nearly 200 years. According to a recent press release, over half the bond has already been funded. The second tranche is open for investment now, with an expected close date of September 16. The bond has a coupon of 12% and pays the interest in physical silver, deposited directly into a Monetary Metals account. Interested investors should contact Monetary Metals here to learn more.
About Monetary Metals
Monetary Metals has been delivering a yield on gold and silver to their clients since 2016. The company has a track record of over 57 funded transactions, including the first gold bond offered in the United States since 1933. Since then, they’ve financed two other gold bonds and are now offering the first silver bond in nearly 200 years.
Interested investors can find more information on the silver bond opportunity here.
The company offers free storage, extremely low costs to purchase (less than 1% over spot), and free shipping and insurance for sending in metal to fund an account.
Why Silver Bonds?
Gold and Silver bonds are like dollar bonds except that the principal and interest are denominated in ounces of metal. For example, instead of a $30,000,000 bond, you could have a roughly 1,000,000 silver-ounce bond. Borrowers are required to pay the interest and principal back in ounces.
This structure provides a built-in hedge for the borrower’s production while giving investors the opportunity to earn a yield on their gold or silver positions. The yield from silver bonds eliminates storage and insurance costs and enables investors to grow their total silver ounces over time, while maintaining exposure to the silver price. Monetary Metals has an in-house team of experienced originators, analysts, and underwriters who perform due diligence on every bond opportunity.
1A photo of the gold bond certificate Monetary Metals' clients received for investing in the first gold bond. The certificate is printed on real 24 karat gold.
Key Details of the Silver Bond Opportunity
This loan is unique because it will be paid entirely in physical silver. Under the terms of the agreement, accredited investors will earn a 12% annual yield on the bond over three years. The 1.2 million ounces of silver raised for the bond will be used to fund the “re-start and ongoing development” of an Idaho-based lead-zinc-silver mine scheduled to begin production this year. The team managing the operation brings decades of experience from industry giants like Barrick, Rio Tinto, Newmont, and Anglo American.
- Total Ounce Amount: 1.2 million ounces of silver
- Interest Rate: 12% paid in silver
- Term: 3 years
- Security: Secured against the assets of the borrower
- Minimum Investment: 1,000 ounces of silver, plus accrued interest (only available to accredited investors)
Investors must open a Monetary Metals account to participate.
Will Silver Outperform Gold?
Investors in the silver bond get exposure to the silver price, plus an additional 12% yield, paid in silver. Monetary Metals CEO, Keith Weiner says that silver could outperform gold in coming years.
...Silver…has managed to hold critical support above its 50-day moving average of around $29 an ounce. Weiner doesn't concern himself too much with the dollar price in silver, saying that the market would have to drop significantly lower to outweigh the returns on a 12% annual yield.
"I think we are starting to see silver attract more investors, and it is likely to outperform gold in this new bull market," Weiner said.
This article includes sources from Kitco and publicly available information online.