Should you buy silver as an investment? It is natural for investors to wonder whether they will make money investing in something or not. It’s true with silver. This precious metal has a small market and is not held in high esteem like gold but many recognise the importance of owning this precious metal. If you are wondering why you are looking for compelling reasons for you to buy silver, consider the following:
#1. Silver is money
Silver may not be part of any currency used in the world but it is in fact a form of money. Unlike money it cannot be created out of nothing like paper currency or other forms of digital currency. Silver like gold is a store of value. The metal has long been used as money for millennia and continues to do so.
#2. Silver is a Hard Asset
You can hold your silver investment in your hand. Silver and gold stand in contrast as an asset you can easily put in your pocket and to take it anywhere you need to go. It is a hard asset that you can hold privately. Silver like gold is a tangible asset which is important when one considers what can happen to money existing digitally. You cannot hack silver. It’s not something that can be erased with a few keystrokes on a computer.
#3. Silver costs less than other
Would you believe: You can acquire a hard asset like silver at 1/80th of the current gold price can be protected from inflation? This means that if the gold price is $2,000, you can expect to buy silver for $25. This makes it more affordable and can be a useful start to your investment journey especially if it is your first time buying silver. You might not be able to afford an ounce of gold but you will find that silver is more attainable.
#4. Silver is More Practical
Silver might be cheaper to buy but it is also more practical when you need to sell. For instance, if you find yourself needing a bit of cash to handle an emergency then you shouldn’t need to sell an entire ounce of gold when all you need is less than that. Silver comes in smaller denominations and you can sell just what you want at a time.
Even die-hard fans of gold know the practicality of having silver in their portfolios. Make sure that when you buy silver it is the kind that can be sold anywhere in the world.
#5. Silver Does better than gold in bullish markets
The silver market is relatively small but it is very volatile especially when the market is bearish. In bear markets the price of silver falls more than that of gold. In a bull market, silver soars further and faster than gold.
#6. Silver Inventories Are Falling
In the past, a lot of governments stockpiled their silver. However nowadays, the global supplies of silver are low especially since coinage is no longer made from this precious metal. Instead the use and demand comes from industry.
Should you be buying silver now?
Historically, silver has not performed so well when stock markets crash or when there is a recession because of its high industrial use. However, history has always been it is still a safer option than paper currency. The demand for silver declines when industries are under strain and not producing as much as they should. The price of silver will remain high unless the monetary system is retooled to curb currency creation.