Silver Mining Terminology and Investment Gloassary
Silver Mining Terms Glossary — Seasoned investors already consider gold a safe haven asset, however, silver is proving to be one as well due to its continual demand in industrial applications. Despite a price fluctuation, experts expect silver’s value to climb steadily amid global uncertainty and growth within the tech and renewable energy sectors. Whether you’re looking to diversify your portfolio with precious metals or are interested in investing in a commodity with growing demand, silver investment products are valuable assets that can hold their value and hold up your portfolio.
If you are not currently involved in precious metals investing or mining, a learning curve includes a unique terminology set that seasoned investors know. Familiarizing yourself with mining language will help you better understand the space and set you up for success when trading silver stocks or investing in silver mining companies. We’ve compiled a list of key silver and mining terms you will encounter when purchasing or investing in silver mining stocks.
Silver Mining Terminology Investors Should Know
Ag: Chemical symbol of silver, derived from the Latin term “Argentum.”
Alloy: A substance mixing two or more metallic properties to create one elemental metal. Silver alloys contain a purity below .999.
Alluvial: Sedimentary material, sometimes carrying precious metals like silver, that can be deposited in riverbeds or mountainous regions such as the Andes Mountains
Amalgam: A mixture of mercury and silver, gold, copper, or another metal, known since classical times. Significant use is in dentistry.
Argent: English term used for silver, derived from the Latin term “Argentum.”
Assay: A test to determine the amount of precious metal in ore and mineral deposits, such as silver or gold.
Backwardation: The term for where market prices are progressively lower in future months versus in the nearest month. Backwardation is the opposite of “Contango.”
Bactericides: Materials, such as silver salts, that inhibit bacterial growth and kill bacteria.
Bear Market: When the stock market falls or is expected to fall.
Blast Furnace: A furnace where oxide or sulphide ores, such as copper, iron, lead, tin, etc., are mixed with fluxes and fuels and are blown with a continuous blast of hot air — sometimes oxygen-enriched air — to force combustion to create metals.
As junior mining companies reach emissions reduction targets and sustainability goals, the industry is slowly phasing out this process.
Blast Hole: A hole drilled into rocks specifically for explosive blasting rather than exploration and geological information.
Bull market: When the stock market is rising or is expected to rise.
Bullion: Precious metal in its physical forms, such as a coin or a bar that trades at the current bullion price.
Capital Gains Tax (CGT): Capital gains tax, also known as CGT, is a tax levied on profits made from the sale of assets purchased at a lower price.
Cash Market or Price: The physical commodity or the price required for immediate settlement. Also known as “spot price.”
Commercial traders: Commercial traders, also known as the US futures market, can represent precious metals producers or refining companies. If an asset class falls in value, commercial or futures contracts can act as a hedge.
Commodity: A physical asset commonly traded and has a monetary value based on its commercial or industrial value.
Commercial silver: silver that is.999 fine (99.9% pure) or higher and is typically sold and shipped in 1000 oz. bars.
Complex Ore: An ore that contains several minerals, one or more of which is economically valuable, implying that extracting or separating the valuable metals will be difficult.
Contango: A market condition in which prices in future months are gradually higher than in the nearest delivery month. A contango market typically shows an abundant supply of a product. The inverse of “Backwardation.”
Core: The sample or cylindrical segment obtained when drilling into a substance, such as rock.
Core hole: a hole drilled to retrieve cores/core samples.
Delivery: The tender of a commodity, such as silver or gold, against a futures short position during the period specified in the futures contract.
Doré Bullion: A mine-produced impure alloy of silver and gold that is typically 35 percent silver and 65 percent gold.
Doré Silver: Crude silver that contains some gold.
Diversification: The spread of investments across several asset classes and sectors. Precious metals diversification helps to reduce risk, and gold works as a buffer in times of financial turmoil.
Exchange: A location where brokers conduct business, typically one of the major stock or commodity exchanges.
Exploration: The search for economically exploitable mineral deposits and the extension of existing deposits.
Feasibility Study: Research based on a significant amount of supplementary information, comprehensive engineering, and optimization work to give economic assurance to support the undertaking of mining and production activities.
Fine Silver: Pure silver in which 1000 parts fine or 999.5 parts (or greater) per 1000 parts silver are present.
Silver Futures: A commodity agreement and binding contract for the selling or receiving of a commodity at an agreed-upon future date at an agreed-upon price determined by public auction in the trading pit of an organized public commodity exchange.
Gangue: Waste rock that must be removed from ore to recover the desired mineral.
Grade: The amount of precious metal per tonne of ore, usually measured in grams. The grade also represents the concentration of a given element in an ore deposit.
Hedge: The process of minimizing or offsetting financial risk or loss by investing in another commodity, such as gold, or through futures contracts. Many investors will purchase gold or silver futures contracts when markets underperform to establish a hedge and balance the loss.
High Grade: A deposit containing high-quality ore.
Joint Venture: Mineral exploration or mining activity that two or more partners fund.
Leaching: The process of extracting a soluble metallic compound from ore by dissolving the metals in a solvent.
Malleable: The process of shaping or extending a metal by hammering, forging, or other means.
Metallurgy: The study of extraction, smelting, refining, alloying, and metals fabrication.
Native Silver: Naturally occurring silver in a relatively pure metallic state, particularly in the far north, such as Canada and Norway.
Options: The permission or right to buy or sell specific securities or commodities at a fixed price within a certain time frame.
Ore: A type of rock that contains metal or minerals that can be mined and processed for profit.
Over-the-Counter (OTC) Options: Flexible options representing a specific agreement between the seller and the buyer, each acting as a principal.
Production Cost: The working costs of a mine for producing a metal, which might include smelting, refining, and any by-product benefit but generally excludes taxes, exploration, depreciation, depletion expenses, and financing.
Recovery: Indicates the proportion of valuable material that is obtained during ore processing. It is typically stated as a percentage of valuable metal obtained through processing compared to the total valuable metal present in the ore.
Recovery: The percentage of valuable material retrieved after ore processing. It is usually expressed as a percentage of the valuable metal produced after processing versus the total valuable metal present in the ore.
Reserve: The amount of a mineral within a given set of boundaries. Depending on deposit thickness, depth, quality, and economic variables, reserves are classified as gross/total, workable, or potential working. Proved, probable, and possible reserves are also terms common in mining.
Sterling Silver: Metal comprising 92.5 percent silver and 7.5 percent copper. Sterling silver is silver of .925 purity and is also referred to as “Standard Silver.”
Silver plating: The method that coats a base metal object with a thin layer of fine silver using electrolysis.
Silver Solder: A class of alloys with at least 10% silver, zinc, and copper used for brazing or connecting other metals. Also known as “Brazing Alloys.”
Spot Price: The current cash market price of silver or gold.
Tailings: Material that is rejected from a mill after the valuable minerals have been extracted.
Vein: A mineral-filled crack or fault in a rock stemming from a deeper mineral source.