If you’re investing in precious metals, don’t leave silver out of the equation. Silver can be a dynamic, profitable investment in the right market.
Precious metal investors often suggest splitting your total investment between gold and silver. Silver prices can be volatile, but they grow faster than gold. While gold provides stability and wealth preservation, you can take advantage of silver’s big moves.
Before you invest in silver, check out these 5 facts about silver investments.
#1 Silver Is Cheap
Silver is more accessible to average investors than gold. With silver trading around the $15 mark per ounce, it’s easier to buy silver coins and bars in large quantities. Buying larger quantities of a precious metal can often save you money from a silver dealer.
But that’s not the entire story to silver. Silver is also undervalued compared to gold. Over the past 50 years, the gold-silver ratio has averaged around 30-70 (i.e., 30-70 ounces of silver equaling one ounce of gold). Today’s gold-silver ratio is well over 80, meaning that silver is historically undervalued. Silver is a great value investment if you’re looking for an asset at a bargain.
#2 Silver Prices Move with Gold
There is a close correlation between silver and gold prices. Over the last half century, silver and gold prices have moved in the same direction on 71% of all trading days and moved in the same direction on a monthly basis 74% of the time. When you scale back and look at year-end results, gold and silver moved in the same direction in 39 out of 50 years.
#3 Silver Is a Fear Asset
The economic outlook for 2019 shows increased growth on the horizon in advanced and emerging economies. This has two contradictory impacts on silver: increased industrial demand and decreased investor fears.
If you want to learn how to invest in silver, the first thing you need to know is what investors do when they get scared. They take their money out of stocks and sink it into “safe assets” like gold and silver. Precious metals have a history of appreciating in value when stock markets become too risky. A good economy could leave silver price growth anemic.
#4 Most Silver Is Consumed by Industry
Unlike gold, over half of the silver produced each year is consumed by industry. A strong economy also means increased industrial demand for commodities including silver, which is used in electronics, solar panels, medicine, and many other industries.
#5 Physical Silver Coins Is the Best Way to Buy
Owning real silver coins and silver bars is the securest way to invest in silver. You can find investment-grade silver coins with online silver dealers like Silver Gold Bull. Physical silver coins minimize counter-party risks which you face in an ETF or investing in silver mining stocks. Mining stocks, as a matter of fact, are high-risk investments, and while the precious metal itself remains valuable, silver miners have a long history of mismanagement and rising costs.
Investing in silver can enrich your portfolio. Get beyond the yellow metal and see what silver can do for you.