Like gold, silver is a great investment option to hedge against economic and political uncertainty, inflation and to diversify your investment portfolio. However, with gold costing around 80 times more than silver, silver is a much more affordable option to obtain these benefits. Gold Survival Guide outlines the pros and cons of investing in silver below.
Why Invest in Silver?
Great Value
Silver is sometimes called the poor man’s gold; however, that should not put people off from investing in it. The cost of silver is currently around 1/80th the price of gold, which makes it more accessible to investors with limited savings or spare cash flow. Instead of viewing silver as “poor man’s gold,” see it instead as getting many of the benefits of gold but at a much lower price.
High Returns and Stability
According to Statista, silver has outperformed most other asset classes over the past five years with an average return rate of 15.17%. The return rate in 2020 for silver was 47.8%. Many analysts predict that silver will continue to offer high returns based on increasing industrial demand and demand from investors who are concerned about the stability of the global economy. The fact that silver is yet to return to its record high of $48 set in 2011, while gold has topped many previous records, is also encouraging for silver investors.
Due to its relatively low price, which encourages speculators, and because there are several demand inputs that influence the price, silver can be a volatile investment. However, silver, like gold, is a finite tangible asset, which means that it is unlikely to completely crash because of its inherent and real value.
Diversification
Like gold, silver tends to move in the opposite direction of stocks and bonds, which makes it attractive when looking to protect your investment from market instability. Most financial advisors recommend having 10% of your portfolio diversified with gold and silver. With its relatively much lower price, silver is a more affordable option for those looking to diversify their portfolio.
Silver also offers protection from a currency collapse.
Silver Price
As with gold, the price of silver is determined by supply and demand. However, there is a greater demand for silver as an industrial application, which means the price of silver is more likely to fluctuate. Gold Survival Guide provides charts and prices to help you keep track of the price of silver.
Time to Buy
Similar to other markets, there is no absolute way to know the ideal time to purchase silver. However, there are effective techniques and indicators that Gold Survival Guide will assist you with to limit your risk and identify the best time to buy.
See Gold Survival Guide’s When to Buy Gold or Silver.
Options to Invest in Silver
There are several ways to invest in silver, from owning physical silver to purchasing shares in companies that produce it. The most common options are to buy coins or bullion, silver futures, ETFs that own silver, silver mining stocks, or ETFs that own silver mines.
Gold Survival Guide recommends buying physical silver and is here to talk you through your options. The benefits of owning silver bars are outlined here.
The Risks
Demand for silver comes from both investors looking to protect their wealth, and from industrial demand, such as for use in electronics, medical equipment, and renewable energy. Having several demand inputs means that the price of silver can be volatile.
A downside for New Zealand silver investors is that the price of silver is slightly more expensive for them to purchase than in other countries. The main reason for this is the country’s geographic location, which means transporting silver to New Zealand costs more than elsewhere. Ships transporting silver also have high insurance costs. Also affecting the price, New Zealand has a relatively small market when compared to other areas of the world.
When buying physical silver, another issue investors need to be aware of is fake silver. Unfortunately, there is an active fake silver market, and fake silver can be difficult to spot. To protect against this, it is best to buy from a reputable seller. Gold Survival Guide only deals with reputable long standing local and international suppliers and distributors. If any of these suppliers were found to be dealing in fake silver, it would put them out of business.
Where to Store My Silver?
Most people store their silver in either a home safe or a safety deposit box. Gold Survival Guide has a relationship with New Zealand Vault and recommends storing your silver with them. New Zealand Volt has been operating since 1931 and offers state-of-the-art vault facilities with insurance. Gold Survival Guide can also assist with off-shore storage.
See Gold Survival Guide’s storage options for more information.
Where to Buy Silver in NZ
Keen to buy silver? Visit Gold Survival Guide’s online store now!
The bottom line
Investing in silver is a great way to diversify your portfolio, protect your wealth, and potentially make high returns on your investment. Visit Gold Survival Guide for all the tools and support that you need to start investing in silver.
Have more questions? Contact Gold Survival Guide today!
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