Silver Investing is a Glittering Opportunity

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Some ‘in the know’ investors may laugh if you suggest that silver is a great bet. They might counter by saying silver has dragged its heels for a long time.

While silver is considered a poor relation to gold, and gold is the stronger status symbol, silver has so many more uses – uses that are common, and growing.

Technology as we know it cannot function without silver. The growth of the middle classes in emerging markets, such as India, China, Russia, and Brazil means that the demand for electronic items is only going to increase.

More than 90 percent of silver is used in some form of manufacture:

  • Consumer goods/electronic items
  • Photography
  • Jewelry
  • Silverware
  • Coinage

Silver is Consumed

Did you know that we throw away the majority of the silver that’s produced each year? That’s right. There’s silver in landfills around the planet, as consumers dispose of millions of tons of unwanted items.

There’s no efficient or cost-effective way to recycle silver from post-consumer items. Supply has not met the demand for more than two decades, which has led to reserves of silver being bought up.

Remember: supply and demand determine value. High demand and low supply always force prices higher.

Fundamentals of Silver Investing

Buy and hold silver. You will automatically be reducing the amount of silver in the supply chain, and over the years your bullion can only increase in value.

Whenever a commodity is in demand and lacking supply, there is a fundamental shortage. People holding that in-demand commodity are virtually guaranteed to realize strong gains.

So, sell the farm and put it into silver? Of course not! Any sane investor always maintains a balanced approach, adding silver investing to their diversified portfolio.

Forms of Silver

Silver investing takes multiple forms.

You can invest in physical silver: bullion, or coins. Ignoring collectible coins, you are seeking to buy and hold coins purely on their silver content.

Because this is a specialist area, and there is still silver bullion available, it’s wise to stick to the simplest method: buying silver bullion, or pure silver coins from reputable, world-renowned mints.

One advantage of physical silver is the joy of ownership. You can touch and appreciate the investment you have made. Also, in times of crisis, those silver bars or coins will have spending value that either paper currency or paper silver will no longer have.

Paper silver is an alternative often used when it’s impractical to own large quantities of bullion.

It can be more convenient to trade paper silver if you’re an active investor, and if purchasing a large quantity, it prevents you from needing secure storage.

However, you should not put all your investment funds into paper silver. If things turn bad quickly, it will be hard to liquidate your paper silver, and you won’t have the advantage of physical silver “money” in hand.

Silver investing in stocks means buying an equivalent that follows the price of silver closely on the open market. Again, it’s not the same as owning physical silver, and silver stocks should certainly not be your only silver investment.