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The Silver Lining: Can Silver be Used as an Inflation Hedge?

The Silver Lining: Can Silver be Used as an Inflation Hedge?

Silver is considered a viable investment to protecting your purchasing power when inflation is present. Silver is a lower cost to purchase in comparison to gold and offers somewhat similar characteristics.

Silver has industrial and technology uses that will constantly reduce supply and help ensure continued demand. For this reason, silver can offer more upside potential than gold. This precious metal has the potential to be a worthwhile addition to your portfolio. Let’s look at why you should consider using silver as an inflation hedge.

Price of Silver

Historically, the price of silver has risen approximately by 40% when adjusted for inflation since 1915. This spells good news for investors who are looking for a viable inflation hedge and are looking to maximize the returns on their long-term portfolios.

That said, silver can be viewed as volatile when implemented in a short-term investment strategy. However, when silver is utilized in a long term investment strategy, it can yield consistent growth and is a viable alternative to fiat currencies which can fall in value due to excessive government debt..

Price of Silver

Holding a commodity like silver can protect your wealth in the event of continued inflation. Moreover, silver is also used in technology and industrial sectors, leading to a sustained demand for the precious metal.

Advantages of Investing in Silver

Silver can be a wise investment and an ideal instrument to diversify your portfolio. However, like any investment, it is important to research, do due diligence, and understand your risk tolerance. That said, there are plenty of reasons why you should invest in the precious metal. Using silver as an inflation hedge can be a brilliant way to protect your financial future. Here are some advantages of investing in this precious commodity.

It Has an Intrinsic Value

Silver is a physical and tangible asset. Tangible silver carries no counterparty risk. Silver can provide a solid sense of security during economic uncertainty due to the absence of debt.

Unlike stocks, bonds, and other paper-based investments, silver coins or bars hold intrinsic value without assuming the risk in debt normally assumed in traditional paper investments. In other words, no one is borrowing or loaning against your financial future when you own tangible silver.

The absence of counterparty risk proves valuable during recessionary periods or when an economy is experiencing a downturn. Investments with debt will add risk to the equation, and can lend to portfolio losses in turbulent times, investing in silver is a great way to hedge against the risk in debt and inflation.

Long-Term Appreciation

In addition to being a stable a debt free investment, silver also offers the potential for long-term and sustained appreciation. Historically, silver has risen in value with inflation.

Long-Term Appreciation

Therefore, silver offers investors a sense of security, even though silver can increase in value very quickly, investors should view silver as a long term investment vehicle.


Silver is quite affordable when compared to other precious metals such as gold. When taking advantage of silver as an investment, most look at the gold-silver ratio, which is the number of silver ounces that equal the dollar amount to purchase one ounce of gold.

three silver bars are sitting on top of the table.

While historically, the ratio has hovered around 65, it now stands near 85. Looking at historical data, whenever the ratio tops 80, silver is relatively affordable compared to gold, and it signals a bullish trend for the commodity.

Investing in Silver

According to expert’s forecasts, silver is expected to move past $30 an ounce this year due to the economic turmoil and the Fed increasing interest rates. Historically, silver prices have consistently risen with inflation. Therefore, it makes sense to invest in silver as an inflation hedge.

That said, when purchasing silver bars or coins as an investment, you should always buy from a reliable precious metal company. It is extremely important to choose a precious metal company that offers transparency in online product pricing and best-in-class customer service.

Get Started with Orion Metal Exchange 

If you’re looking for a reputable precious metal company that can help you buy, sell and trade silver commodities, you’ve come to the right place. Orion Metal Exchange is a dependable and trustworthy company that can help you diversify your portfolio into precious metals.

Orion Metal Exchange is the answer to all your precious metal investment needs. We provide a safe, secure, and reliable platform where investors can buy, sell, and trade commodities such as gold and silver ira, open a silver ira, platinum and palladium.

We can also help you open a precious metal IRA and store and insure your tangible holdings in an IRS-approved depository. Call us at 1-800-559-0088

Get in touch with our representatives today to learn more about our services.  

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