Many people asked whether they should invest in Silver or Gold.
The answer is… It depends. There are pros and cons for each metal.
Let’s first look at Silver.
Silver has a number of things going for it. First, it has a lower entry point price. This means that the average person can go and buy $50 or $100 dollars worth of silver and have many options to choose from. For example, there’s a large variety of 1 oz silver bullion coins to pick from. You can buy 1 oz silver Eagles which are a United States minted coins or 1 oz Silver Maples which are Canadian minted coins both of which are easily recognized and authenticated. You could also buy silver bars, silver bullets, tombstone silver, silver stackers or “junk silver”. All of these have price points starting at under $100.
Silver has a big advantage over gold if you’re buying the metal in anticipation of a financial crisis. This is advantage lies in the fact that it’s possible to use silver as a means of barter more easily than gold due to the options available in Silver. It is possible today, to buy silver in recognizable forms with values starting at around one dollar. For example, you can buy a war nickel (See our blog “What is a War Nickel”) which contains 35% silver for $1.11 at today’s spot price for Silver. (Everyone knows what a US nickel looks like.)
The main thing going against silver is the weight and the resulting needs for storage.
Now, let’s look at Gold.
Gold requires comparatively little space to store. At today’s silver gold ratio, Gold would take 1/68th of the space to store compared to equivalent value in Silver. (see What is the Silver Gold Ratio?)
There is no doubt the Gold is a very good store of value and it will make an for an excellent investment. The challenge comes if you are buying it in anticipation of a financial crisis. It is not possible to buy gold in a recognizable form for the same price as silver and no one wants to be stuck with coins worth hundreds or thousands of dollars when they only need a loaf of bread.
One last consideration should be the silver to gold ratio. According to Gold Eagle, an online precious metal investment research platform, in the 20th century, the silver to gold ratio has been around 47 to 1. Given that the ratio today is approximately 68 to 1, that would suggest silver is the better buy.