When seeing the price of sister metal gold soaring, some investors may wonder if silver, as another precious metal, is a good investment choice and if it is appropriate to buy silver now.
Although the silver market is smaller and less attention is paid to it compared to gold, it is still a reliable asset to include in an investment portfolio in terms of its investment value.
Silver, like gold, is a form of currency. Although it is not commonly used as currency in our daily lives, it still possesses the attributes of currency. In fact, just like gold, silver is the ultimate form of currency because it is not created out of thin air, thereby avoiding the possibility of depreciation like paper currency or electronic currency. Gold and silver have served as true assets and currencies for thousands of years. As the best-selling book “Investing in Gold and Silver” says, “For thousands of years, gold and silver have repeatedly proven their value, forcing paper money to prove itself.”
Silver has a lower price and a lower investment threshold. If I told you that you could buy a hard asset at a price that is only 1/70th of the price of gold and it can withstand various crises just like gold, would you be interested to know what this asset is? Yes, it’s silver. For ordinary investors, silver is more affordable. If one ounce of gold seems too extravagant to you, then silver is the perfect investment choice for you.
Silver is an effective tool for diversifying investment portfolios and should be a distinctive component of any investment portfolio. It can maintain its value in the long term and provide a buffer for your investment portfolio in unfavorable market conditions. In the event of a stock market crash, if you have overinvested in high-risk financial instruments, silver assets can hedge against some of the losses. History has shown that during stock market crashes, silver prices typically rise, and this is not a coincidence. Having a portfolio that includes both gold and silver helps offset stock market losses and provides a source of backup funds for reinvesting in undervalued stocks during economic recovery.
Silver outperforms gold in bull markets. Silver is a smaller market, and even a small influx or outflow of funds can have a much greater impact on its price compared to other assets, including gold. This greater volatility means that silver’s performance in bear markets is not as good as gold. However, in bull markets, silver’s gains can potentially surpass those of gold.
To give a more recent example, we know that gold prices rose by a total of 166% from the bottom in 2008 to the peak in 2011, but during the same period, silver prices rose by 448%. We can almost predict that silver will continue to outperform gold in this current bull market.
Industrial demand for silver continues to grow. You may not believe it, but in fact, there is not a single product that we use every day that does not contain silver. Among all elements, silver is the most indispensable metal. It has the highest conductivity, thermal conductivity, and reflectivity. From electronics and medical applications to batteries and solar panels, almost every major industry uses silver. Whether you can see it or not, silver is truly everywhere. Without silver, modern life cannot function properly. Due to these rare characteristics, silver’s industrial applications are becoming increasingly widespread. In fact, industrial demand accounts for almost half of all silver demand.
So, should you speculate on silver? Currently, the overall consensus among traders and market experts is that silver has great upside potential in the long term. Unlike many other asset types, silver is supported by increasing industrial use, and its downside risk is relatively limited, making it a preferred metal for novice investors. In the long run, silver will maintain its strategic importance and can hedge against various market events that may indicate an economic downturn.
When trading silver, the preferred platform is 4E. As a leading global financial asset trading platform, 4E offers trading for nearly 500+ financial products, including forex, cryptocurrencies, US stocks, commodities, indices, and more. Among them, silver derivatives support leveraged long and short trades with leverage of up to 200x, and the minimum trading volume is 0.01 lots. With low entry barriers and low spreads, you can open a position to buy silver in just three simple steps and start your silver investment journey!
As the global partner of the Argentine national team, 4E is known for its security and reliability in the industry, ensuring the safety of funds. With over two million users worldwide, the 4E platform supports trading on both computers and mobile apps, with a simple and intuitive interface and 24/7 online service for assistance anytime, anywhere. It is the ideal choice for your silver investment.
