It’s a natural reaction for any savvy investor to question if a particular asset is worthy of investment or not and when the potential investment involves a small market, the skepticism is understandable. However, some assets, regardless of the market size, make a compelling case for a reasonable investment and, in this instance, this is especially true for silver.
Why It’s the Right Time to Invest in Silver Bullion
Regarded by many top analysts as one of the most undervalued commodities, we very well may be witnessing the start of an exponential rise in silver prices in the coming years.
Silver Investments and Economic Trends
While some have questioned how much longer silver can continue to be such a hot commodity, especially with such spectacular gains, many are still expecting silver to continue its overall boom that began back in 2000. As silver prices have gone from $5 (2000) to $49 (2011), an overall 880% gain, this has put silver with an average growth of over 25% per year. Considering such astonishing gains, it’s understandable why people are afraid of hopping aboard. The word “bubble” is all but at the tip of everyone’s tongue.
However, the time periods for bull markets typically last over 5 years and can remain for up to 15 years. In fact, if you were to take a look at the history books, no similar commodity bull markets last for less than 10 years.
When you consider the time periods that commodity bull runs tend to last, you will find comfort in knowing that we are near the bottom of this particular cycle and simply waiting for the next big run.
Silver Supply and Demand
Another reason why you should not be afraid of investing in silver is because of the underlying supply and demand values for silver. Since 1996, the demand for silver has continued to grow as its industrial uses continue to expand with new applications found for the versatile metal.
Some experts even think the yearly deficit in silver could potentially increase to up to 250 million ounces of silver as new demands for silver grow in popularity. After the economic collapse in 2008, demand for silver saw another increase, while supply had been at a steady standstill. In fact, the U.S. Mint has had to suspend orders for silver coins for the year on several occasions due to running out of bullion blanks to utilize. The difference between then and now is the amount of silver that is available, as well as the growing number of industrial uses and investment demands for silver.
The final indicator that silver is poised to continue its rise in value over the long-term is its inability to maintain pace with gold. When taking a closer look at the gold-to-silver ratio, the bull market ratio once stood at 31.68 ounces of silver to one ounce of gold, but the ratio now requires around 90 ounces of silver for one ounce of gold, which is the third highest in the last 100 years. This means that silver is an even more intriguing buy and should eventually outperform gold as the ratio moves closer to historical norms.
Buy Silver While You Still Can
Any rational investor would step back and examine market forces shaping the price of silver, but they will all tell you that with stagnant supply and surging demand, silver more than appears to be very well poised to continue moving even higher.
Silver bullion offers a unique value for the everyday person to hedge against the ultimate backdrop of a declining dollar. Silver appears to be the best long-term precious metals investment with the end of price manipulation, falling volumes of paper silver, increasing physical demand, a supply deficit, and a rising gold price are all set to push the price of silver even higher. While no outcome is certain silver should be considered as a remarkable investment opportunity for the coming decade.
Committing a portion of your portfolio to silver bullion could be one of the best investment decisions you ever made. Call (800) 867-6768 to speak with one of our metals strategists today.