Investing in silver is one of the possibilities that arises in raw materials and you don’t just have to think that it could be a refuge value like Gold, there may be several other reasons. The difference with gold is that it is better to invest in jewelry, for example, but with silver it is better to go elsewhere in the investment.
Many turn to gold for better benefits when investing and returns and that there are financial products that are based on precious metals such as gold, they weigh much more with respect to funds and ETFs. But some investors want to choose to invest in silver.
There are within the world of ETFs , some that are based on silver and the best thing is that they offer a lot of liquidity, you can choose between ETFs that are based on futures and ETFs that are based on physical silver. If they choose this last formula, they should know that they will be backed by silver in physical form, since it will behave in the same way as the price of an ounce of silver and carries a low risk.
While the future ETF is a contract that ultimately forces you to buy or sell a certain amount of goods on a certain date, having an already established price, there are certain risks such as variations in its price and it is a double-edged sword since that just as they can report high profits, they can also report heavy losses, which is why they are risky.
This means that they must have experience and intuition when choosing, in times of crisis if they want to invest it is best not to play the bold investor, as they say half of something is better than nothing of a whole.
One to take into account is the USLV that is based on futures proof of this is more than 70% of recent gains, or the SLV that is based on physical silver reports 22%. If you want to invest in the form of ETF, you have to take into account that at a certain point they behave like shares , being able to buy or sell whenever they want. The ETFs are generally quoted in the US, in addition to being in dollars, if they are in Spain they will be able to operate and invest.
As in any investment that involves gold or silver since for different reasons of the crisis prices can skyrocket, and silver has a prosperous future in terms of its usefulness in various industries, in addition to the fact that silver is linked to the dollar .
As we know with the crisis, the price of gold grew to unexpected values, re-emerging again as the safest investment, although it is always present. In 2010 it was already said that silver was beginning to shine as a refuge value. Apparently just as it happened with gold, silver, much cheaper than gold, has become a good alternative to US Treasury bonds.
By 2010, China was driving its growth in its price, since the government viewed with concern the weakness of the dollar as a result of the strong injection of money that the Federal Reserve at that time. The campaign of the Chinese television channel CCTV that encouraged the Chinese population to invest in silver is remembered.
The explanation was given that for that year the country’s inflation data accelerated to 2.7% , and given the fear of excess liquidity, for that year the average savings per family was between 30% and 40%. What pushed that, the Chinese government will push to buy silver, and that it is more affordable than gold, as a method of mitigating the impact of inflation on the purchasing power of the population.
This had the consequence that the population in China exceeds 1,300 million inhabitants together with a savings ratio that is more than high , it could cause the price to skyrocket if the population followed the purchase recommendations. Until 2 years ago, silver accumulated a revaluation of more than 300% since the year 2000 , thus becoming another asset that at that time and now investors also see without risk, as has happened with gold since the crisis, and as happened before. with the real estate.
Silver is one of the main conductors , above copper, where its applications are numerous, from solar panels to mobile phones. The main consumers of silver for industrial use are, in this order, the United States, Japan, India and China, so as growth in these countries shows signs of improvement, demand expectations will increase.
On the other hand, in terms of supply, silver production is closely linked to that of zinc, lead, copper and gold, while only a third of production is obtained exclusively from silver mines. Therefore, the price of silver is intrinsically linked to that of these raw materials.
It seems that as long as people do not see strong currencies, the euro began to fall and the dollar is still there, nor economies with sustained growth, investment alternatives that have the least possible risk will continue to be sought. But as is known, precious metals are scarce and therefore prices can still rise above their real value.
