Investment in Silver

Silver is also a monetary metal. The mintage of silver coins dates back a lot of millennia. But unlike gold that has been extracted from the beginning of history continues having value today, silver has other industrial uses such as production of alternative energies, photovoltaic and wind energy, which consume significantly and growing the global production. For every ounce of gold produced 11 ounces of silver are produced, but only 40% is available for investment in bullion or coins. So the reality is that there are only 4 or 5 ounces of silver for every ounce of gold investment. .

However the demand for silver exceeds the demand of gold: sales in the Canadian Mint in 2013 were 100 ounces of silver for every ounce of gold; sales of LibertyDollars in silver in the USA Mint were 40-1 regarding ounces of gold.

Although investment in silver has the drawback of the value added tax, now set at 21%, it continues to be similar to the premiums paid for small gold pieces. For example, it is common for the smallest gold coins, of 0.5 grams to have prices per gram that entails payment of a premium of up to 100%. Gold pieces between 1/25 and 1/4 of ounce premiums vary between 15% and 30%. Specifically, coins of 1/10 of an ounce of gold, that is, 3.11 grams, have premiums that are close to 20%, similar to VAT. So VAT should not be an obstacle to decide for silver and small savers to fill a piggy bank, diversity in designs and a huge variety of sizes and weights make it the most attractive and stimulating way of saving.

The behavior of silver prices in the international market is more volatile than gold. It is natural if it is understood that the same amount of money that moves in both markets will affect much more in the market the price of silver since at current prices, for every ounce of gold you can buy 80 ounces of silver, a market that is only three or four times higher in tonnes, 1 US dollar that enter or exit of the market, affects 16 times more the price of silver than in the gold market. Taking into account the fundamentals of the market and the historical series of ratio between gold and silver, it can be concluded that the current situation is an anomaly (1 ounce of gold buy 80 ounces of silver) and that the conditions of physical supply will tend to return to their stability condition about 15 ounces of silver per ounce of gold, so in the long-term silver has the potential to increase in value 4 times more than gold.