Six Secrets of Silver Investing

by Augusta Precious Metals |

(UNITED STATES MINT)2018 American Eagle Silver One Ounce Proof Coin

In this guide, you'll not only learn why silver is an ideal asset for your portfolio under practically any circumstances, but also why it is a compelling buy right now for investors seeking another great opportunity to build wealth.

Let's look more closely at each of these important silver benefits and how they could potentially help you improve your own portfolio.

1. Silver Remains One of the Few Genuine Stores of Value

What does it mean to be a genuine store of value? In simple terms, a store of value is a form of currency that has a long-standing, historical record of reflecting inherent value to anyone, anywhere in the world.

But there's more to it than that. A true store of value has the basic characteristic of inherency, which means in this case it cannot be altered, diminished or otherwise marginalized by anyone, including governments.

Physical silver has no counterparty risk. When you own and possess it at home or in a depository to which you have direct access, no counterparties are involved – no one can "default," for lack of a better word, on the asset.

2. Silver Often Outperforms Gold During Precious Metals Bull Markets

Something else about silver, in particular, that makes it such an attractive, naturally occurring wealth asset is its propensity to outshine gold when precious metals bull markets are in play.

Two of the most prominent, long-term precious metals bull markets in modern history occurred from 1970 to 1980 and again from 2001 to 2011. When you put gold and silver side by side and measure the return of each during these timeframes, you'll notice something interesting and maybe even a little counterintuitive, depending on your existing ideas about precious metals, including gold and silver.

From January 1970 to January 1980, gold was up roughly 1,500 percent. Very nice, right? Well, hold on. During the same period, silver rose more than 2,100 percent.

As for 2001 to 2011, you surely recall the problems facing the economy during that time. There was the burst of the dot-com bubble, the tragic events of 9/11, and of course the Great Recession. And during those turbulent years, gold rose nearly 650 percent. Impressive, to be sure, but silver did even better, rising about 900 percent.

3. The World's Supply of Silver is Falling

A compelling reason for moving into silver at this time is its shrinking supply. The Silver Institute, in its World Silver Survey 2017, reports the world's physical silver supply has run a deficit for four years. There are good reasons to believe that deficit will persist.

For one thing, silver mining costs have grown and until silver prices rise high enough that mining becomes cost-effective (you'll ideally already be on board with silver then), dedicated silver mining is expected to remain minimal.

Only collateral silver from copper mining is expected to increase in the coming years. But now even that appears less than certain due in large part to issues such as labor strikes at the world's largest copper mines, along with operational issues related to uncooperative weather.

Also, most government silver sales for the last 15 years were from China, Russia and India, but no one is selling any now.  Why have China, Russia and India silver sales ground to a halt? China and Russia continue to increase stockpiles of gold and silver, which affords these nations great latitude to establish precious metals standards as a basis of trade.

4. Demand for Silver is Growing Worldwide

Industrial demand for silver is expected to increase in the next several years. As it is, silver is ubiquitous in industry, chiefly because it is considered superior to all other metals as a conductor of heat and electricity. Not only will developed nations obviously continue to rely on silver for industrial output, but silver will be crucial to emerging-market nations seeking to grow their footprints on the global industrial stage.

Detailing all of the ways silver is regularly used by industry could be a special report by itself. For example, silver's applications are particularly prominent in multiple aspects of the manufacturing of automobiles, appliances, computers and cell phones. In fact, industrial reliance on silver accounts for roughly 50 percent of the overall demand for the metal, with the electronics industry leading the pack.

5. Silver Defies Rising Economic Uncertainty in the U.S.

Silver possesses the capacity to be a reliable safe haven when economic conditions sour – something to be especially mindful of these days.

It's worth noting how silver performed during the Great Recession. From October 2008 to April 2011, when the economy was stagnating and the stock market was struggling, the Dow Jones Industrial Average returned roughly 37 percent. But how did silver do? Its price appreciated nearly 400 percent.

The U.S. national debt recently topped $20 trillion.  As debt increases in relation to GDP, if another recession comes, likely the government will "monetize" the debt with new cash.  The result?  High inflation – the very condition historically prompting so many to turn to precious metals in search of financial safety.

6. In Spite of Attractive Fundamentals, Silver is Very Cheap

Right now, the stock market is bouncing around at all-time highs. Gold is around $1,300 per ounce and reached its all-time high of a little over $1,900 per ounce back in 2011. Silver, which hovered around the $50-per-ounce mark as recently as 2011, is just $17 per ounce right now. What does your common sense tell you, based on these price points, about which of these two precious metals assets is best-positioned to next double in price?

The current price itself may not suggest a particular urgency to buy silver.  However, in the context of the other timely factors at play, including the supply deficit, growth in worldwide industrial use of silver, efforts of major Eastern world powers to stockpile precious metals, and a continuing climate of economic uncertainty, the price of silver right now appears to make the metal a compelling buy.

About Augusta Precious Metals

To learn more about how to take advantage of what we see coming – a significant bull market in silver – you'll want to be sure you have access to the right experts, such as those you'll find at Augusta Precious Metals.

Augusta Precious Metals is proud to be a full-service provider of products and services to those discerning individuals who recognize the important role physical gold and silver can play in both growing and protecting wealth. At Augusta, you'll find all manner of high-quality precious metals products, including the most popular gold and silver coins at the industry's best prices.

Whether you're interested in a silver cash purchase or transferring funds from your current retirement account into a physical gold and silver IRA, Augusta Precious Metals is ready to serve as a trusted partner and knowledgeable, committed team to help you on your journey toward financial freedom and security.