Bullion investors shouldn't expect to see a drop in premiums anytime soon as the supply crunch for gold and silver coins continues to grow, this according to Peter Hug, global trading director for Kitco Metals.
However, in some good news for investors, Hug said that investors holding bullion have a little more selling power, in the current environment. "Dealers will pay up for physical material so they have something in their inventory to meet demand," he said.
"I'm not suggesting you sell, but if you're in a situation where you're trying to raise cash, this would be a time to negotiate a bid with the dealer." Although Hug said that he is bullish on gold, because premiums are so high, it might not be a great time to chase physical bullion.
Peter Hug has been involved in precious metals since 1974. He began gaining first-hand investment industry experience at Deak-Perera. He served as SVP at Guardian Trust Company, which became one of the largest international trading houses for precious metals. He developed the first precious metals certificate program and the first margin trading accounts for metals on the cash market. Peter has acquired extensive experience in the wholesale markets and international asset diversification. A frequent speaker at precious metals conferences and in the financial media, he is one of the handful of experts who have succeeded through multiple bull and bear cycles on the strength and skills honed during the dramatic fluctuations of the 1980s. As the Director of Kitco's Precious Metals Division, Peter develops newer and better investment options for Kitco customers.