‘Invest in gold’ that was always the advice given in years gone by. The reasons were obvious. Gold underpinned every currency in the world. There was a limited supply. Gold was desirable. The value went up, even in a recession. However in the modern world, this advice may not be the way to go.
More and more people are turning to trading, and investing in silver when they look for commodities trading. In fact, silver trading is at a similar level, if not slightly above gold. There are numerous good reasons for this, and reasons why you should choose to invest in silver in 2010.
When Gold Goes Up, So Does Silver
Everyone knows that the price of gold is rising significantly, and has been rising for several years. This is due to a variety of reasons, many of which are fairly obvious. The great news for those thinking of trading or investing in silver, is that these two metals are very much linked when it comes to prices. Historical trends have shown that when gold goes up in price, so does silver. So the current increase in gold prices will continue to cause the increase of silver prices. And the good news is, there are plenty of silver penny stocks to watch for potential investments.
Declining Stocks Push Up The Value
For the first time in history, the US has no stockpile of silver. This means that it is buying on the open market. It has used its entire six billion oz stockpile over the last 60 years. This shows the fact that silver stocks are declining worldwide. This pushes the prices up. Stockpiles are going to continue to decrease, and the price is going to continue to increase.
Worldwide Political Instability & Uncertainty
A lot of silver mining is done in countries that are often politically unstable. This can interrupt supplies, and is probably why delivery times on new silver are extremely high. In times of political instability (which there is likely to be increasing amounts of over the coming years), the price of silver will continue to rise.
Price Is Artificially Low
Much of the silver that is traded is traded as paper, never actually being physically transferred between owners. This is achievable because there is a 2-3 month reserve available, and at the moment no problems in supply. As above however, the inventories of silver are rapidly decreasing, with production not keeping up with demand. As these supplies dwindle, but the same amount (if not more) silver is traded, invested in, and ordered, the price is going to skyrocket.
I'm Aaron Redick, personal finance blogger to the stars (well, not really). I'm just a regular guy (well not really either). Seriously though, I have a lot of experience with investing and finance, and I'm here to teach you what I know. Please follow me in this journey to help ordinary people succeed where others have failed.