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Skittish Investors Flock to Silver

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Investors are recognizing some extra risk in markets and want protection. Gold, and more recently silver, have been a big hit. Amrith Ramkumar writes in The Wall Street Journal of silver’s drive to a nearly four-year high:

Both gold and silver tend to attract investors when money managers are skittish about the global economy and seeking alternatives to stocks and bonds. They continue to attract investors who expect a bumpy economic recovery in the years ahead. Meanwhile, ultralow bond yields continue to make precious metals more appealing to investors because the metals don’t offer any returns simply for holding them.

And some analysts expect a flood of stimulus programs around the world to eventually stoke inflation, devaluing paper money and making gold and silver attractive stores of wealth.

Silver has risen at an even faster pace than gold lately, reversing a yearslong trend. Silver had languished behind its precious-metal peer for years, pushing the ratio of the gold price to the silver price to historic levels.

The pattern is starting to reverse, however, with traders rapidly increasing bullish silver wagers in recent weeks. Silver also has many industrial applications in everything from electronics to solar panels, so the reopening of Chinese factories in recent weeks and a rally in base metals such as copper also is supporting demand.

“Silver has been more popular than gold among investors for months now,” Commerzbank analysts said in a note, citing huge inflows into silver-backed exchange-traded funds recently.

Silver is a counterbalancer that can add diversification to your portfolio and could help you survive a financial meltdown. If you are serious about your financial survival, sign up for my monthly Survive & Thrive newsletter, by clicking here. But only if you’re serious.

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E.J. Smith - Your Survival Guy

E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. His focus at all times is on preparing clients and readers for “Times Like These.” E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zilldjians. He grew-up worshiping Neil Peart (RIP) of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West and Paris. Please get in touch with E.J. at ejsmith@yoursurvivalguy.com