Many analysts believe that silver is due for a substantial rise and that the precious and industrial metal has reached its price bottom. The prediction makes silver look like an excellent safe haven investment for 2022 portfolios.
But are silver investments really worth the time and money? It’s important to understand the benefits and drawbacks of investing in silver before making a decision.
The following guide will explain how to invest in silver, why you might want to, and how it compares to gold.
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Benefits of Silver Investments
Silver gets used frequently in industrial fabrication because it’s an excellent thermal conductor. For example, it’s used in photovoltaic solar panels. So, silver’s value should rise with the popularity of solar energy in the coming years.
The automotive industry also relies heavily on silver for the electrical components of modern cars. Silver membrane switches help start engines and operate windows.
Of course, silver jewelry is another huge use that contributes to its value. Silver jewelry is easy to sculpt, doesn’t require much care, and lasts for a lifetime.
Its use in soldering together other metals and even silverware provides two more industries that rely on silver. Its versatility a wide usage make it a safe and smart investment.
Silver Compared to Gold
First, silver is cheaper than gold and makes for a much more affordable investment. Investors get more silver on the dollar which creates a greater chance for profit.
However, the silver market is much smaller than the gold market. So, there’s more volatility with silver and bigger price swings. There are also more buyers for gold making it easier to sell.
Gold also has industrial uses, but its price largely hinges on investor sentiment. Some might see this as a negative, but it also means that gold is a nice hedge against the economy.
Ways to Invest in Silver
One way to invest in silver is to buy physical silver coins or bars. Just remember that physical forms of silver require storage space and expenses. If you’re interested in buying coins, you can learn more here about the process.
You can also invest in silver-related stocks if you don’t want to store physical silver. Examples include mining companies and resellers. Note that it’s hard to find pure silver stocks because it’s typically mined along with other metals.
You might come across ETFs (mutual funds) that include silver in their portfolios. Some mutual funds even invest in physical silver.
ETCs offer another option for silver investments and work similarly to a bond. Silver functions as the collateral for some ETCs.
Ready to Invest in Silver?
Now you know that silver investments come in many forms such as coins, stocks, and mutual funds. You also know that it’s affordable and used across many different industries. While it differs from gold, smart investors often include both metals in their portfolios.
Silver isn’t going away and its uses are evergrowing making it more than worth the time and money as an investment. Take a look at our finance category for more great investing ideas and tips.