How to Invest in Silver: Your Comprehensive Guide
Are you thinking of investment but not sure of the perfect option to pick? One good option that you might want to consider is silver. Like gold, it is a precious metal that has cut a name for being able to hold value, especially during the period of inflation and economic downturn. So, whether the economic turndown caused by the COVID-19 pandemic swept your stock under the bridge or government policies have pushed the value of your favorite currency pairs into disarray, this might be a good time to diversity with silver. In this post, we will tell you all that you need to know about investing in silver.
A Brief Look at Silver Price Action in the Last Few Decades
Before looking at the main methods of investing in silver, it is important to try to answer the question, “How has it performed been in the past?” and “How is it likely to perform in the coming year?”
From 1995 to 2003, the price of silver was about $5 per ounce. However, the price started going up after that era, and reached $16 per ounce by 2014. This means that a person who had invested in silver around 2004 enjoyed about 200% growth in revenue by 2014.
With the uncertainties that are facing major currencies today, from Brexit to trade wars between the US and China, it will be a great idea to diversify your investment portfolio with silver.
How to Invest in Silver
There are a number of ways that you can use to invest in silver, including buying physical silver bullions, trading mutual funds, and buying shares of companies that deal with silver.
- Buy Silver Bullions
This is the most direct method of investing in silver, and it allows you to take full possession of the silver. You can even open the safe and say, “this is mine.” What a great way to invest in silver?
Coins are considered the most convenient method of holding silver bullions. For example, it is possible to purchase a one-ounce pure silver coin. But if you prefer larger quantities, it will be a great option to look for silver bullions.
When dealing with bullions, it is important to think about storage for safety. For example, it might be a good idea to start by installing a good safe at home for storage. You might also want to use depositories, which come with insurance and top-notch security. However, you will be charged a fee for storing your silver in a depository.
- Exchange-Traded Funds (ETFs)
If you do not want to invest in direct silver bullions, the next option, which is equally awesome, is ETFs. This is a method of holding silver bullion, but through a fund. The fund traces the silver price because it stocks the metal in trust. This implies that you will not get to own the bullions but the shares of the ETF that has the silver bullions.
- Buy and Trade Shares of Companies that Deal with Silver
Another indirect method of investing in silver is targeting the shares of companies that mine silver. These stocks are used mainly for speculative purposes, although they mainly follow the price of silver on the market. When using silver mining companies’ stocks, you need to understand the things that impact the price, from international disturbances, foreign government regulations, labor unrests, environmental catastrophes, and currency fluctuations. Make sure also to follow the management of these companies because they can also impact their stock performance.
If you are new to silver investing, this guide has laid bare all that you need to do. Make sure to understand the selected method well and also follow the latest about the market performance. You might also want to start by learning more about silver investing, and GoldAvenue can come in handy to offer you this information.