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Detailed Guide to Investing in Silver

Multiple silver coins

Silver is a very popular investment option; people have been investing in it and trading it for years. It is currently trading at $18.72 per ounce in the United States. This makes it one of the most affordable precious metals you can invest in!

Silver has a wide range of applications in multiple industries these days. It’s popular for making jewelry, solar panels, dental equipment, photography and film-making equipment, etc. Silver’s demand is expected to go up, making its prices go up as well.

If you’re confused about which precious metal to invest in, silver could be a great option. Here’s a detailed guide on investing in it.

Stacked bars of silver

Reasons to Invest in Silver

One of the main reasons why you should look to invest in silver is because of its economics. Silver is way less expensive than gold yet offers similar protection for your investment.

Most investors who invest in precious metals have silver included in their investment portfolios. This is because silver is a good short-term investment option and can even give you better returns than gold.

Silver is inversely related to the economy. When the economy and other commodities crash, silver gains value. This means your investment will be safe and retain value over time. Moreover, the demand for silver also increases its value and is expected to go even further up in the coming years, making it a safe investment option.

Factors that Affect the Price of Silver

Multiple factors affect the price of silver. These are:

Price of Gold

Silver and gold prices have been linked with each other directly for a long time. Whenever the price of gold rises, the price of silver is also expected to go up. Similarly, whenever the price of gold drops, the price of silver also drops.

Economic Conditions

A stable economy is not a good time to invest in silver or any other precious metal. This is because silver is inversely related to the US Dollar. When the economy goes down, silver prices go up.

This is why experts advise investing in precious metals like gold and silver is the best way to save your investments in case of an economic recession, predicted to hit very soon.

Supply and Demand

Silver is highly demanded because it’s an industrial material for multiple products from different industries. For example, with more attention being paid to the problem of climate change, automotive manufacturers are shifting to green technologies in cars, like catalytic converters that reduce emissions and batteries that reduce fuel consumption. Silver is an important part of these components, increasing its demand significantly.

In times of recession, prices of silver are expected to increase drastically because most people tend to buy precious metals as a last-ditch attempt to save their wealth and investments.

Ways to Invest in Silver

There are multiple ways you can invest in silver. These include:

Futures Contract

Futures are a very common and easy method to trade any precious metal, including silver. Futures are contracts that obligate investors to trade or the buyer to buy any commodity at a fixed time and predetermined rate. The purchaser is obliged to buy the precious metal per the contract’s conditions, and the trader or seller must complete the precious metals handover process within the due date. Failure to comply with the conditions of the contract can result in legal implications if any party decides to sue.

Silver Shares

If you’re an investor, you must be aware of the stock market. Stocks are one of the most common ways of investment throughout the world. Mining companies offer shares of silver on the stock exchange. Americas Silver, Coeur mining, and Hecla mining are some of the most popular and trusted silver mining companies with stocks on the market.

You can make a profit on stock investment when share prices rise, as well as receive income in the form of dividends.

A person monitoring the prices of shares on the stock market application on phone

Silver ETFs (Exchange Traded Funds)

Exchange Traded Funds facilitate investors in buying and selling commodities. ETFs work like mutual funds. They track particular sectors, commodities, and assets. However, unlike mutual funds, EFTs can easily be bought or sold on the stock market.

Silver EFTs were first introduced in the early 2000s and attracted the interest of both seasoned and amateur investors. Financial analysts and senior investors believe Silver EFTs are a smart way to trade and invest in silver and diversify your portfolio. This is because they have a 31.8% long-term capital gains rate and also help you keep track of spot prices.

Spot Prices

Spot prices are the complete opposite of futures. They allow an investor to buy or sell a commodity at the current market price. As in day-to-day trading, spot prices are usually used by traders who invest in short-term.

Silver Bars, Bullions, and Coins

If you’re planning to go the traditional way, buying silver bars, coins, and bullion is also a good way to invest in precious metals. You can purchase authentic silver bars and coins through certified precious metal dealers.

Precious metals like silver can be safely stored for years and won’t lose their value. You also have secure storage options if you don’t want to keep your silver at home.

Multiple silver coins

Now that you know the basic details of investing in silver, it’s time to contact a reliable precious metal investment company to invest in.

Orion Metal Exchange is a precious metal company with a 4.9 rating on TrustPilot and is accredited by BBB. We offer silver bullion and coins, as well as other precious metals, including gold, platinum, or palladium. We also offer secure vault storage for gold and silver to safely secure gold and silver storage and can convert your traditional IRA plans into precious metal IRA plans for your retirement savings. Get in touch with our team for further details.

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