Is Silver A Good Investment?One of the terms used to describe Silver is that it is 'the poor man's Gold.' This isnt a fair representation of its intrinsic value to commerce, which we will get to later on, nor does it tell us the full story. Of the four precious metals that are the most attractive to invest in, Silver is the lowest in value. At the time of writing this piece, silver had an ounce price of just over $17, compared to gold at over $1211, platinum at $995 and palladium at $759. What we must remember though is that it is not the monetary value that makes us money, but the value of the metal to industry and commerce, along with the return on investment. So while silver has a monetary value considerably lower than the other metals mentioned above when it comes to investing, this certainly is not the case when you look at its worth to businesses. The industrial use of silver is higher than platinum and palladium and certainly a lot greater than that of gold. Only around 12% of all gold is used in industry, whereas that figure is around 50% for silver. In fact, Hard Assets Alliance state the following concerning the industrial demand for silver:
How to work out If Silver is a Good InvestmentOne of the best ways to work out if silver is a good investment option is to compare its price at the time to that of gold. All you need to do is look at the gold-silver ratio. To do that you look at how many ounces of silver would it take to buy one ounce of gold and you have your ratio. So for example, if gold were $1,000 an ounce and silver was $12 an ounce, the ratio would be 83. Now, this ratio is an excellent indicator to help you decide when is the right time to invest in silver. When the ratio is high, this is considered by experts as the best time to buy silver. The ratio chart below (taken from macrotrends.net) shows that at the start of February 2017 the ratio was 68.92. Although not the highest it has been, it is still above the average for the past 40 years of 55. If the ratio is greater than 70, this tells you that silver is substantially undervalued in relation to gold. What Are The Pros & Cons of Silver Investment?The Pros To Silver Investment
Diversification
ROI
Low Cost
Demand
The Cons To Silver Investment
Time
Volitility
What is best to invest in - Bullion or Coins?Investing in silver bullion/bars and coins each have their benefits and downsides, and you need to consider these so that you make the right investment choice. Investing in bars provides you with a lower premium than coins. The greater the bar size, the lower the premium will be, therefore if you are looking for a premium in your investment, bars are the better option. Investing in coins enables you to achieve quick yet small financial returns as they are easier to sell than bullion. However, be aware that the premium on coins is higher than on bars. This means that the return on investment when selling coins won't be as high as you may like. What Are The Options For Investing In Silver?Like any investment, you need to consider before you do it, why you want to invest in silver? If your reason is simply to own collectibles, without looking for short-term gains, then that is quite straightforward. You will find that there are many coin providers available for you to choose from, on the internet. If you are looking for investment purposes, are you seeking to invest in physical silver or add it to your retirement account and create a silver IRA? If you go to our companies page, you will see we recommend some companies for precious metals investment. Speak to them about your requirements and they will set you up with the correct investment type to match your needs. DisclaimerPlease note that the content on this website does not constitute financial advice and should not be taken as such. The owner of this site may be paid to recommend Regal Assets or other companies. The content on this website, including any positive reviews of Regal Assets and any other reviews, may not be neutral or independent. It is advisable to always speak to a certified financial advisor before making any investment decision. Current PricesThe post Is Silver A Good Investment? appeared first on Precious Metals Investment Guide. Original source here: Is Silver A Good Investment?
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