Silver As An Investment

If the economy gets better, then silver as an investment won't be good which given the circumstances is highly unlikely, but if the economy continues to stagnate and the Federal Reserve and central bankers in Europe keep printing money, then silver will likely do well.

This makes investment in silver coins or bullion less attractive for the private investor in the UK and Germany, due to the extra premium on purchases represented by the irrecoverable VAT (charged at 20% in the United Kingdom and 19% for bars and 7% for bullion products with face value, e.g. U.S. Silver Eagle and Maple Leaf, in Germany).

Whether you are a new investor deciding whether or not you are going to buy silver at today's prices, or are currently holding silver related assets and considering whether or not to sell or buy more.

What Makes Silver As An Investment Good

What makes silver as an investment interesting is the huge gap between supply and demand. The world has been using nearly 900 million ounces of silver a year. Meanwhile miners are only producing about 600 million ounces. This fact alone is what makes silver investment so lucrative.

Since most of us can't perfectly time the markets, I wanted to compare historical returns to three investment strategies where every year you consistently invest in either mining stocks, silver, or gold.

Be aware too, that just like gold Exchange Traded Funds (ETFs), silver ETFs, if held in a taxable account are viewed by the Internal Revenue Service as collectibles - meaning you don't get long term capital gains rates if you hold the investment for longer than a year. If you look at the last 10 years (or 7, or 5), gold and silver have been a much better investment than the S&P. No comparison.

Silver as an investment has appreciated in price more than any other investment in the past two years. "Silver could be the investment of the century," says Gregory Marshall, president and CEO of Global Asset Management, a wholesaler of silver, gold, platinum and palladium.

The US government forced those in traditional investments into the safe haven historical assets of choice gold and silver. I believe silver will surpass gold as an ideal investment. Silver and gold investments would have had a negative or near zero compounded annual return until 2004. There are many in the mining and geology fields that see silver vanishing from the planet within 30 years, primarily due to increasing industrial needs, totally irrespective of investment demand.

Silver As An Investment – The Facts

Investment in silver coins is a relatively new form of trading, as mentioned previously it was only in the second half of the 20th century that the value of the metal used exceeded the currency value of the coins themselves. Investing in Silver is a good long term investment and most people here won't tell you that .999 Silver coins are minted each year, but NOT circulated and are made for collectors only.

The big catalyst for surging silver prices in the coming years will be exponentially increasing investment demand, which is already beginning to overwhelm existing silver supplies.

In addition to macroeconomic, systemic and geopolitical risk; geological constraints, terrorism, climate change and natural disasters such as Hurricanes and Tsunamis; there are other risks that mean that the old Wall Street advice to invest 10% of one's portfolio in gold bullion and hope it does work is more important now than at any time in living memory.

Given silver's even more favourable fundamentals, an allocation to silver as an investment would also be extremely prudent as it is likely to outperform even gold in the coming years.