Is Silver the New Gold?

Gold has always been considered a good conservative investment, a sort of hedge fund against the fickle nature of the stock market. But what about gold’s often forgotten sister silver? Both silver and gold attract investors in uncertain economic times. There are many reasons why silver may now be a better investment than gold. Could silver become the new gold standard?

The amount of gold currently available (already out of the ground) continues to be many times more than that of silver. Some estimates show there is seven times as much gold as there is silver. Using the law of supply and demand, coupling this disproportionate supply tilting toward gold and the fact that silver has more uses (demand) than gold, it makes sense that the value of silver would increase at a faster rate. The number of uses for silver is increasing at a faster rate than gold as well, making silver even more attractive.

Another reason silver may be a better investment than gold is because of the popularity of gold. Because of the uncertain economic times, gold has become more and more in demand. As demand grows, supply decreases. If people can’t find gold to buy, they will look for alternatives, and silver is the logical choice.

Historically, the ratio between the price per ounce of gold and that of silver has averaged around 15-20 to 1. Currently the ratio is around 70 to 1. By all accounts, silver seems to be heavily undervalued at this time and deserves to be looked at as a better investment than gold.