Why Silver is a Great Investment

Why Silver is a Great Investment

The public faith in silver has been on a rapid rise over the past decade and there isn’t many investor portfolios that doesn’t have silver in it. The historical instances of legendary investors including Warren Buffet who bought around 130 million ounces of silver in 1998 has only fanned interest in silver investment. The trend of buying silver stockpiles is very much in fashion even now with Billionaire George Soros investing $9.1 million in silver mining stocks last year. So, what makes silver a great investment? Here, are some points which might help in answering this very question.

             1. Safe from Inflation

Silver like other precious metals is a safety policy and an insurance against hyperinflation and collapse of the economy. Though, there may be a very minuscule policy of complete economy collapse, but as we have seen the possibility of a recession is ever present. In fact, it was precious metals that led economic revival post 2007 recession. The fiat currencies such as dollar, euro or pound have tendencies to fall in face of recession or economic meltdown. In fact, the value of dollar has rapidly decreased over the past decades with present value of $7 being equivalent to $1 of 50 years ago. And, silver’s value has only increased and strengthened over that same time period.

             2. Practical Uses

Those who remain sceptic of the economic downturn and silver’s ability to withstand it, should consider the fact that it has large number of practical uses, which brings it closer to routine facets of economic than gold. Among the metals, it is the best conductor of electricity and best reflector of light. It’s used in many medical processes and is a popular catalyst for many industrial processes. The industrial processes in which silver is used are batteries, bearings, soldering, and electronics. It also has many traditional uses such as coinage, photography, jewelry and silverware.

             3. Silver Mining

Almost 75% of silver production is a by-product of copper, zinc, or lead mining procedures. These mines are very expensive to run and maintain, and in event of recession, the mining of these metals is significantly decreased due to drop in industrial demand. This will result in drop in supply of silver, which would be faster than the decrease in demand of silver. As, we all know the prices of precious metals are directly related to increase in their demand, hence a significant jump in the value.

             4. Uncertainty in Future Supplies

The majority of silver that’s mined in areas that are mired in political turmoil. Mexico and Peru are top producers, while Chile, Bolivia, and Russia where social order is on the edge of limits also feature high in the silver production list. The political instability, labor strikes, and poor infrastructure can put significant strain on the silver supply.

              5. Emerging Demand

Of late, China and India have shown a huge appetite for Silver and Gold as they boost their bid to stabilize economic expansion. The emerging market investment demand will lead to increase in demand for the physical metal.

I recommend Regal Assets for all of your Gold or Silver purchases.