Silver prices are tracking Global record these days. The values are rising continuously of metals and especially Silver and Gold are rapidly inclining in terms of value, in investment terms, you have probably already heard about the complementarily between gold and silver. The price of silver tends to be correlated to the price of gold, but not in the same way. In fact, the heavy use of silver in industry makes its pricing much more volatile.
Given the present-day economic climate and the frequently rising demand for silver, we have identified few reasons why one should think about investing in silver.
1. Cost-Effective Metal
If we can compare the prices of the two metals that is Gold and silver, we can figure out that silver is 70 times cheaper than gold. Buying a Silver jewelry or coin can be an affordable deal and a middle class family wallet can allow for this investment as prices for silver are rapidly increasing and it can be the best long-term investment.
Owning silver itself means you are an owner of real Asset. If we go through the Indian history , we can analyze that silver is more used rather than gold be it coins or jewelry, silver was basis for these asset, which is why the prices for silver is too low that makes it easy for it circulated and traded in the economy.
3. Falling Silver Inventories
The Governments and Institutions holds the silver inventories traditionally. Nowadays, Most of the governments no longer hold stockpiles of the metal. Infact, Only countries like- US, Mexico and India warehouse the silver. It tends to be one of the reasons; governments don’t hold a lot of silver is because coinage is no longer made from the precious metal. But as the usage of silver in industries is on huge amount government will face scarcity of Silver to fulfill the needs.
4. Highly Demanded Metal
India and China both hold a long-history of cultural-affection towards precious metals and therefore these two countries could be recognized as giant market for Silver. Demand for silver is continuously inclining in the graph. The demand doesn’t happen in a vacuum. There will be consequences when surging demand meets crimped supply, Sooner or later—and those consequences are all positive if you ultimately own the metal.
5. Silver & Gold Ratio
47:1 was gold-to-silver ratio averaged during 20th Century and in 21st Century it was seen to be as 61:1
,As a result of ratio, at or above 70 is in standing apart territory and gradually silver is a perfect buy relative to the price of gold. It is clearly visible that the ratio sank to almost 30 at the peak of the bull market in 2011. Than it reached low as 17 in early 1980. This compression in the ratio shows just how much silver can stand out its cousin gold. It also confirms it is undervalued compared to gold.