For traders who invest in precious metals, gold is and always has been the primary choice. Gold is an ideal investment for wealth purposes, and has a long tradition of becoming a solace for traders who lose faith in currencies. However, gold is still inaccessible to some individuals, primarily because of its price and volatility. Fortunately, there is one viable alternative to gold that is also under the precious metal group and that is, silver.
Veteran silver investor David Morgan wrote on his blog that silver is often ignored by investors because of the high gold-silver price ratio. However, he stressed that there are three qualities that make silver a good investment as gold. Firstly, he said that the higher concentration of investors in the gold market leaves more room for silver buyers to make substantial changes in the price by trading said metal alone. Secondly, silver’s low price makes it more accessible to individuals who cannot buy gold in bulk. And finally, the silver trading market is a perfect boot camp for people who aspire to eventually move on to the gold market.
Here is InfoMine’s gold/silver price ratio. While the disparity between the two metals increased over the past few years, the ratio is comparatively lower than other rates in the past twenty years. In 1990, the ratio hit an all-time high as the price of gold was 94.3 times higher than silver. The price remained above the $60 mark until 2011, which is the closest that silver got to gold at 44.7:1. With silver at its optimum price at the moment, it may be a good time for small-time investors to ponder on investing in the precious white metal. Traders can invest in silver through bars or coins, but investment site BullionVault suggests choosing bars. This is because compared to whole silver bars, coins are always sold at a higher premium.
Despite encouraging individuals to start trading in gold, however, David Morgan warned that people should approach the silver market with caution, as well as read more about the market’s fluctuations and trends.
“Investing in silver is a great way to make money, especially if you are looking to secure your future or your retirement. But of course, just like any type of investing, there are no guarantees. You need to know what you are doing and what the silver market is all about before you can get too involved. This is the only way to make sure that you give yourself every possible advantage to benefit from silver investing,” Morgan wrote.