Historically silver has always been a popular method of wealth preservation. Along with other precious metals such as gold and platinum, it has long been admired for its many different properties and today silver is considered one of the most useful metals on the planet. Silver can be found across many different applications from jewellery, silverware and coins to electronic devices and solar panelling. New uses for the metal are being found all the time and current demand for silver is significantly outweighing supply. Here are 7 reasons why we think everyone should consider owning silver.
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Unlike stocks and shares or even paper money, silver is a physical asset that will always be worth its weight in material value. Holding on to hard assets such as silver and gold can also offer vital protection against inflation or potential economic downfall. As a greater percentage of our wealth becomes digitised, having some form of tangible assets becomes even more important.
Compared to other precious metals such as gold and platinum, silver represents a far more affordable option for most people. You can currently get around 75 ounces of silver for the equivalent value of an ounce of gold. For someone who can’t afford to buy gold but still wants the protection afforded them by hard assets, silver is a very attractive purchase.
The fact that silver is so widely used in modern industry makes it much more sensitive to changes in the market than some other precious metals. Whilst on one level this would suggest silver is a riskier investment, it also offers a great deal more opportunities to buy and sell at a profit. The fact that silver has retained its purchasing power over long periods of time means that even when the price is low, there is a strong chance it will rise again.
Like any other precious metal, silver is a finite resource which means that one day we could potentially run out of it. Due to the fact that a lot of silver is used for industrial purposes, much of it isn’t recycled in the same way gold is and a lot of it is just discarded. Whilst this won’t affect the value of silver in the near future, the fact that we are using a lot more than we are producing means that supply might eventually become limited.
Whilst most people think of silver as being a decorative metal, there has recently been a massive increase in the amount of silver being used for industrial purposes. Advances in technology have led to a variety of new applications requiring the use of silver and industrial demand for the metal is predicted to rise by 27% in 2018. This is partly down to a huge growth in demand in China where the explosion of the solar energy industry has led to an increased need for silver. Additionally, cloud seeding is increasingly used to stimulate rainfall in water starved landscapes, one of the main chemicals needed in this process is silver nitrate.
Several years ago, a massive crash in the silver market meant that mines had to cut costs significantly in order to stay profitable. With the cost of mining and extracting precious metals becoming costlier, it has become difficult for many of the mines to keep up with production. The irony of the matter is that since demand for silver has begun to rise, these mines are no longer able to produce enough silver to keep up with demand. If this trend continues then some experts predict we could run out of silver in a matter of decades.
Due to silver’s incredibly long list of beneficial properties, there are currently no substitute materials that could be used in its place should silver reserves ever run out. Silver is a very strong and malleable metal. It is also one of the best-known conductors of heat, light and electricity. As more uses for silver are being discovered, we have found ourselves relying heavily on this metal for all kinds of different things. For example, it is a little-known fact that silver is also very highly regarded within the medicinal industry. Due to it’s amazing anti-microbial properties it is often used in medical equipment as well as being used to purify water.
If you would like to hear more about the potential benefits of owning silver, or perhaps you need some advice then give us a call Please speak to one of our friendly advisers on 020 7060 9992
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Daniel Fisher formed physical Gold in 2008, after working in the financial industry for 20 years. He spent much of that time working within the new issue fixed income business at a top tier US bank. In this role, he traded a large book of fixed income securities, raised capital for some of the largest government, financial, and corporate institutions in the world and advised the leading global institutional investors. Daniel is CeFA registered and is a member of the Institute of Financial Planning.