We’ll be posing a simple question that might be on most of your minds, especially if you’re new to the world of precious metals investment – ‘why should I even bother investing in Silver? If gold is worth the time and patience, why should I settle for the literal representation of second place?’. Let’s break down some reasons why silver is still a valuable commodity to have in your portfolio.
1. A good entry point into precious metals
As some of you might have already realised when browsing on Nubex.my, silver is simply much cheaper per ounce than gold. This is why silver is great for new investors if they want to get into investing in precious metals
The good thing about this is that you will still have a physical hard asset to store your wealth with, that is able to hedge against inflation or financial crashes, but at the fraction of the cost of gold.
Another reason why silver makes for a good entry point is due to it being more practical for smaller purchases and transactions. For example, if you required a certain amount for expenses, which doesn’t require you selling a whole ounce of gold for it, that’s where silver comes in.
It also usually comes in smaller denominations than gold, affording you total flexibility and control for purchasing and selling it at any time.
2. It’s actually a rarer commodity than gold
Yes, we hear you. Let us explain. What we mean by this is that the stockpile of silver in the world is much more spread out beyond the confines of investment and finance, compared to gold.
For starters, silver has many more industrial uses than gold, due to its conductive properties. From electronics to photography, silverware to medicine, the world supply for silver is mostly used up, while demand continues to rise as we rely more and more on technological advances.
Silver itself is often generated as a by-product of the mining for other metals (gold, lead, copper and zinc), with only 30% of the amount coming from primary silver mining, while the rest comes from recycling activities.
According to Canadian billionaire Eric Sprott, approximately 46 billion ounces of silver has been mined compared to 5 billion ounces of gold from the beginning of human civilisation, and out of that amount, only 1 billion ounces of silver remain for investment purposes (compared to 2 billion ounces of gold). This is why silver is actually a rarer commodity than gold.
Okay, so we covered the price and its scarcity. What else? Well, another reason why silver is actually worth your time is its intrinsic value, which has been proven for thousands of years throughout human history.
A quick look at the history of coinage, from Ancient Rome to the United States, will tell you that silver has been used for centuries as a form of money, even more so than gold. Many of the terms used today for money are also derived from silver coins of yore.
Another interesting fact for you to take note is that today, most governments no longer hold stockpiles of silver, with the exception of the US, India and Mexico.
This is actually a plus for us, the individual investor, because central banks won’t be able to depress the silver price, since they don’t have any silver to get rid of to devalue it in the first place!
Going back to our point about the increasing demand for silver in many industries, and knowing that most functioning governments no longer have supplies of silver in their reserves, wouldn’t that make silver a VERY valuable asset in the years to come?
Of course, at the end of the day, investing in BOTH precious metals would still be the best option in the long run. However, for those of you who can’t quite afford gold just yet, you will still have a solid, viable option with silver.