Silver coins are available in a wide range of sizes and designs. ![]() Although traditionally available in coins, bars, jewellery and perhaps even antiques, silver is also available to trade on digital trading platforms, allowing easy access to the silver precious metal markets. How can I Invest in Silver?Īs with other precious metals, there is a wide range of options for investing in silver and adding it to your portfolio. Even if the initial VAT cost is factored in, this could be seen as a significant return. For example, from the start of 2020 to the start of 2021, silver rose from £13.58 to £19.95 – an increase of nearly 47%. Although this could be seen as a barrier to entry for some, due to the large price movements of silver already mentioned, this 20% cost could be absorbed by some of the percentage gains which we see in the silver price. This is currently charged at the standard rate of 20% in the United Kingdom. One of the perceived down-sides of silver is the fact that, in part, due to the industrial and technical uses, purchases of silver are liable for VAT. Because of this, adding silver to your investment portfolio can decrease risk overall. In the same way that people invest in gold to diversify their portfolio from stocks, shares and bonds, silver is also used by investors to diversify because, much like other precious metals, silver can provide a low negative correlation to other assets. This is because diversifying your portfolio with silver can also offer the potential benefits of the larger price movements which come with the silver market. Some suggest that silver is used by investors who are slightly less risk averse. Nevertheless, it is still used by many as an investment option, and can form an important part of your portfolio. ![]() Due to a much wider range of uses, in percentage-terms, the price of silver can vary considerably, as the price of gold has historically moved much slower. Demand for silver is one of the main drivers which affects the silver price, so it is an important consideration for investors when contemplating buying it. This means that, unlike gold, the output of silver usually exceeds what would have been recovered on the basis of silver demand alone. However, whilst gold is usually mined at dedicated gold sites across the world, silver is actually a by-product of zinc, copper and lead mining. Much like gold, silver has been used as both a store of wealth and a form of exchange and currency for many years. However, for the precious metal investor, the low price of silver means that it is far more accessible than gold, resulting in many choosing to start their precious metal investment journey with the cheaper alternative. Many use the ‘gold-silver ratio’ to compare how each of the prices are performing in relation to one another, and this shows that, despite the many uses for silver, the price has never achieved more than a tenth of the value of gold. Having said that, although silver is indeed a highly prized metal that has much in common with gold, the prices of the two metals could not be more different, especially when you compare them. This, therefore, means that the price of silver can be linked to overall economic output. These strong links to industry mean that demand for silver often correlates with industrial demand. In addition, the uses for silver are also in the medical industry, as it is actually one of the few metals with anti-bacterial properties. This is partly because silver has some unique chemical properties, including being a strong thermal and electrical conductor. Whereas less than 10% of the gold mined is used in industry, more than 50% of silver is destined for industrial use. Some of the unique properties of silver mean that the industrial uses are greater than the uses for gold. However, silver also has a multitude of unique technical, industrial and medical uses, making it an interesting metal to own and invest in. ![]() Much like gold, silver is prized as an investment option and is often used for coins, bars and jewellery. Both metals have been coveted for thousands of years, and each has been found on every continent of the world. When discussing precious metals, gold and silver often go hand in hand.
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