Will Silver Outpace Gold in Climb to New Highs?

While gold is the commodity most investors choose for a precious-metals safe haven, those who want more bang for the buck frequently turn to silver. These particular investors feel confident they’ve put their money in a hard asset that moves in tandem with gold, yet still gives them greater profit opportunity.
 
That’s because silver is a more volatile metal than gold. For every 1% move in gold, silver moves approximately three times higher. There are several reasons for this. First of all, the silver market is smaller than the gold market. So an investor’s buy or sell in silver of, say, $100,000.00 will have a greater impact in the overall silver market than the equivalent amount of money in the gold market. Because of silver’s relatively rapid return, hedge funds are particularly fond of silver.
 

 
Secondly, silver is an industrial metal. As such, its market movement is more intimately linked than that of gold to developments in particular industries, and, for that matter, in the economy at large. Think of gold with a touch of salt, pepper, and spice.
 
Silver is required as a source of power, control panels, elevator buttons, and railway traffic controls. It’s used as a coating material for DVDs, a catalyst for brazing and soldering, and for medicinal applications because of its antibacterial nature.
 
And as the Silver Institute points out on its website, silver’s “unique properties of strength, malleability, reflectivity and conductivity make it an irreplaceable force in the global market.”
 
Silver has had nothing less than a spectacular price history. In 1974, the Hunt brothers, Nelson and Herbert, used their enormous oil money inheritance along with bank loans to try to corner the silver market. Both brothers believed that, if the intense inflation of the 1970s continued its damage, silver, like gold, would become a haven.
 
As a result, they exploited a volatile metals market to drive the price of silver to almost $52.00 per ounce by 1980. Ultimately, the Hunts were forced to appear before Congress to account for their actions (which included encouraging Saudi investors to pool money with them), and answer charges of silver-market manipulation.
 
Ultimately, the Hunts were forced into bankruptcy. But the lesson we can learn from its relatively recent trading history is, that compared with gold, silver has the potential for greater and quicker returns on an investment.
 
While the gray metal, currently trading at $18.52 per ounce, is a far cry from its $52.00-per-ounce price of the Hunt Brother years, markets have memory. Once a commodity carves a path to a new high, that price becomes a realistic possibility in subsequent years. In keeping with this possibility, silver almost attained its legendary peak again in 2011 when it reached a high of $48.58.
 
If you’re looking, then, for a solid investment in a hard asset that mirrors gold for its safe-haven character, but offers even a greater profit opportunity, you should consider silver.
 
For more information, call 800-777-6177 now, and ask to speak to a Fortress Gold Group representative.

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