Silver is much cheaper than gold, making it more accessible to small retail investors. For those who are just starting to build their portfolios, the cost of silver may make it a better investment option. Gold and silver are long-term investments. These precious metals can be held in a wallet or in an individual retirement account (IRA) to allow for the preservation of wealth.
They have proven to be solid investment options that have provided stability to investors at a time when the stock market underperformed. Over the past 20 years, silver has achieved a return of approximately 365%, but like its precious metals counterpart, silver performed lower than last year, approximately 12% lower. Since silver is less expensive than gold, silver can be considered to be more accessible than the yellow metal. Whether you're planning to invest in silver or gold, there are a few factors you should seriously consider.
While gold and silver have similar boom-bust cycles, there are some key differences to consider when deciding whether to invest in gold or when there is a market crash or even a correction, investors must be prepared; and one way to do this is to diversify an investment portfolio with precious metals such as gold and silver, which are capable of withstanding unrestrained market volatility. Just like when you have a one-dollar bill in your hand, you are sure to be able to have your investment in the form of gold bars or silver coins in your hand (or keep it in your safe deposit box). Regardless of whether you choose to invest in silver, gold, or a combination of both, you'll need to know how to make those investments. Unless you want to get into the jewelry making game, investing your hard-earned money in precious metals such as gold, silver and platinum isn't the best use of your money.
Even in good times, many investors keep a small percentage of their assets invested in gold or silver as a portfolio diversification strategy. Another way to invest in gold and silver without actually having them in physical form is through ETFs. The prices of gold and silver are so unstable (and have been so over time) that, in an economic crisis, their only use would be to wait for someone to take your silver coins or watch in exchange for a package of toilet paper or a can of gas. Some people believe that silver is usually a better investment than gold, and they expect that its lower price will give them a better return if the markets ever change for the better.
Carefully consider the investment objectives, risks, charges and expenses of the fund or funds before investing. But if someone already owns a good amount of gold, an investment in silver may be the best option for diversification purposes.