Transportation, storage, overhead costs, and margin all need to be taken into account for the dealer. We also don’t know what basis value over or under the futures price the dealer is paying. I imagine basis values are overs right now considering the big demand for physical silver and the relatively small movement in futures prices.
If you were to take delivery of 1 futures contract it would cost you about $135k for 5,000 ounces and you would have to figure out the logistics to actually pick it up.
That is the value the dealer brings. 20% premium for physical silver is not bad at all in my opinion.
Transportation, storage, overhead costs, and margin all need to be taken into account for the dealer. We also don’t know what basis value over or under the futures price the dealer is paying. I imagine basis values are overs right now considering the big demand for physical silver and the relatively small movement in futures prices.
If you were to take delivery of 1 futures contract it would cost you about $135k for 5,000 ounces and you would have to figure out the logistics to actually pick it up.
That is the value the dealer brings. 20% premium for physical silver is not bad at all in my opinion.