In times of instability and economic volatility, investing in precious metals such as silver is an excellent option for investors. Silver, sometimes called the ‘poor man’s gold,’ is not just a good investment, but is also a beneficial industrial product. A close runner-up to gold in terms of popularity, silver is more affordable and a preference of many for ornaments and bullion investment.
It is natural for an investor to wonder why to invest in silver rather than other precious metals, such as gold. While silver’s price has remained confined within a limited range over the years, it has several advantages that outweigh the disadvantages. Read on to learn more about investing in silver and why it may be one of the smartest investment you have ever made.
Benefits of Investing in Silver
Cheaper Than Gold
One of the main reasons you should invest in silver is that it is much cheaper than gold. While you can purchase it cheaper than you would pay for purchasing other valuable metals, it protects you just as well in a crisis. Because it is priced lower you can buy a greater amount of it than you can gold. This makes it an excellent option for investors with less capital. If you cannot afford other pricey metals, silver is your golden ticket to making profitable investments for the future.
Multiple Uses
With its several useful properties, such as reflectivity and thermal and electrical conductivity, silver is an excellent industrially applicable product. According to reports, about one billion ounces of silver have been used in consumer products in the last ten years. It is used in innumerable products such as electronics, medical appliances, and solar panels. Its industrial applications are projected to increase in the near future as new technology is introduced into the marketplace.
Increasing Demand
The demand for silver sees a further increment as new uses come to the surface. These uses, such as the bonding wires, are gaining widespread popularity in populous countries like China, adding to the value of silver.
Silver is currently not as expensive as gold. However, it is being used up and mined at a rapid rate. The mining ratio for silver is 11 to 1 against gold. As its demand and commercial use increase with time, silver prices are most likely to rise exponentially as compared to other valuable and costly metals.
Volatility
For active investors, silver is lucrative investment. It is more volatile than other precious metals such as gold. Meaning, its price and worth can swing to sharp rises, considering its vast and ever-increasing number of uses. Another factor that makes it volatile is its small market, where changes are fairly quick.
Secure Investment
Although silver does not have a very high price, fortunately, it is not sold at too low a price either. It is a securer investment as compared to land and treasury bonds. With silver, a better return, even if relatively low, is guaranteed.
Physical Silver
While having digitalized investments is great, investments in the physical form have no parallel. Physical silver, a means of definite money return, can be taken anywhere in the world. It can be used all around the globe for trading and buying/selling. Unlike a digital asset, it cannot be hacked or erased. It is a secure and reliable form of money that can come in handy anywhere and anytime.
How You Can Invest in Silver
Bullion Bars/Coins: Currently, the most convenient and common way of investing in silver is buying it in bullion bars or coins. Due to the production work that goes into minting coins, the bullion coins have a higher premium over bars. The most significant advantage of this method is its simplicity, as you buy large amounts of the metal directly. This allows you to trade it at anytime, anywhere, and whatever quantity you desire. It gives you complete control over your asset, with no third parties’ involvement, enabling you to sell it without any delay. That also means no broker fees if you do it yourself.
Silver ETFs: A Silver Exchange Traded Fund (ETF) includes primarily investing in silver assets. It gives an investor exposure to the price of silver without having to buy it directly. These ETFs or mutual funds are held in trust by a fund manager or custodian. Their value is dependent on how well the assets perform. This method has proved to be a hedge against inflation, allows you to trade silver with high liquidity, and eliminates the logistical challenges.
Silver Stocks and Funds: You can also invest in the silver stocks and funds market. This includes investing in silver mining companies, establishments, and firms that deal and specialize in the distribution, production, and use of silver. These stocks have worth that is beyond the supply and demand of silver. Consequently, this is a more reliable and predictable way for silver investment but is also vulnerable to possible business associated liabilities.
Silver Contracts: Another smart way of investing in silver is signing future silver contracts. This way, you do not have to take direct physical ownership of this precious metal but still profit from it. This method gives you the right to receive delivery on a specified date in the future at a particular fixed price. If the cost of silver rises before this, the value of your deal increases simultaneously. In case of a mishap resulting in a fall in the silver prices, you can sell the contract before the delivery date.
Why is it Best to Invest in Silver Right Now?
As the world faces an economic crisis, the prices of valuable goods are declining. However, this is not the case with silver. Currently, the silver stock market is at an all-time high. The downfall that the silver prices experienced after 2011 is also on the rise.
Silver is available in physical as well as electronic form, allowing quick and easy trade. According to recent records, it has also outperformed gold in bull markets. Moreover, as the needs of the masses escalate, the uses of silver are also increasing. As uses increase, the demand, and ultimately, the value of silver will increase. Furthermore, especially now, in times of uncertainty and crisis, silver is a reliable and good source of saving and income.