A lot has been said about precious metals over the last couple of months. Silver has become a prominent subject in discussions over what is the best thing to invest in. Silver occupies a small segment of the precious metals market. It might not have the same desire as gold but for other reasons, people have been buying silver as an alternative investment.
- It can act as real money
Even though silver is not regarded as money, it is regarded as a form of money because of the intrinsic value it carries. Unlike the real Australian dollar, silver isn’t just created out of nothing. It would take a lot for silver to completely lose its value. Unlike stocks and bonds, when you have physical silver in the form of coins, rounds, or bars you don’t need a third party to make good on some promise for you to liquidate and realize the full value of your investment.
In fact, silver has long been used as coinage more than gold has. When you own silver, you own a commodity with a long history of monetary value.
- It is Cheap
Silver costs 1/80th what gold costs. On the 11th of September 2020, the silver price AUD was 36.66 AUD while gold was 2,663.47 AUD. That is how affordable silver is compared to gold. However just because it is cheaper does not make it less important and precious metal dealers actually love buying silver bullion and coins, especially now.
- It is practical
Silver bullion might be cheaper than gold, but it is more practical when you need to sell. With gold bullion, you have to be extra careful when carrying it around, you can’t afford to accidentally drop it. It might make you nervous to carry something that valuable to you, but you would have to physically take it to a dealer when you want to sell.
Silver also works out fine when you all need to sell to meet a smaller financial need. Silver can be sold anywhere in the world and for these reasons, every investor should have some silver for small financial emergencies. When selling silver, you should take note of the spot silver price AUD. This price can often be found on financial websites and precious metal dealer sites.
- Silver does better than gold In Bull Markets
The silver market is small, which means whenever there is a slight increase in the amount of money moving in and out of the market, the effect on the price can be big. The volatility of the silver market means that it falls a great deal more than gold in a bear market but rises higher and faster than gold in a bull market.
- The Industrial Use of gold is growing
The Industrial use of silver is growing. Silver is used in everything from electronics to medical equipment. Silver is virtually everywhere it can be found on solar panels and in medicine. According to the Silver Institute, the use of Silver in Photovoltaic cells used in the making of solar panels grew by 7% in 2019.
Cellphones contain silver and with the use of cellphones increasing in the billions, the demand for silver will grow too.
Unlike gold, silver used in industrial applications is often consumed during fabrication. Most precious metal buyers buy silver bullion and not so much scrap silver like used or broken jewelry. A lot of people think recycling silver is not economical.
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