Use Precious Metals Investing as a Hedge against Inflation

Silver has received a lot of attention in the media lately, since it has a low price and a high potential for growth. Precious metals investing actually involves other metals that are also worth including in your investment plans.

Silver Just the Facts
Silver and gold are both commodities, but silver is limited and gold is not. We continue to produce gold every year. The silver we have on earth now is all there will ever be, since the earth isn’t making any new silver. So at some point in time, there will be no more silver that can be extracted.


Silver is used for money, jewelry and industrial purposes. The price, which is relatively low now, will no doubt skyrocket when we can find no more. This is a good choice for precious metals investing, since the values are virtually guaranteed to go up, because of the finite amount of silver that exists.

The Market Today and Silver
Most silver mined today is used in industrial applications. It is used in many things, from electronics to photograph development. It can also be found in appliances you may have in your household right now.

The next most common use for silver today is for jewelry, and investing comes in as the least common use of silver today. That means that this is a good time to start precious metals investing. If your budget allows, it will be best to invest before a good many people decide to do the same thing. That will drive the prices higher.

Silver investors today buy for two reasons. One is that silver is an excellent long-term investment, since they know it will be higher priced in the future. They also purchase silver as a hedge against any inflation. Since governments everywhere are printing money that is worthless if the country is toppled, people want an investment that is tangible and will always have worth.

Silver and Gold: A Comparison
The silver market today is a lot smaller than that of gold, in supply and demand, both. Gold prices are high because more people are investing in gold. The downside to precious metals investing in a small silver market is that just one large investor can influence the market in a big way.

This has happened before, even recently. The Morgan Stanley Company has increased their holdings of silver. Since it is in short supply, that buy-up means less silver is available for any other investors. The price has doubled over what it was only several years ago. If they would decide to sell that silver, it would be released into the market again, which would cause wilder price fluctuations.

Beginners Can Invest in Silver
You may feel overwhelmed when you are ready to invest in silver since so many factors affect it. You’ll want to make sure to keep your initial investment and not take any losses. You can still profit in precious metals investing, even at today’s prices. Watching the market daily will help you to make money. But even if prices are volatile, it’s still a valuable long-term investment.

You have four choices in determining how to invest in silver. Buying coins and bullion is one, and the others include investing in the stock of silver companies, investing in exchange traded funds and investing in silver futures.

Buying physical silver isn’t just for doomsday predictors. It can also be a good long-term investment. Don’t buy silver from the jewelry or cash-for-metals store you saw on TV. Monex Silver is a trusted company from which to purchase physical silver. They have low fees, which will allow you to make more over the long term.

Silver futures are usually too risky for beginners, but exchange traded funds (known as ETFs) and stocks in silver mining companies can be a good way to get into the silver market and precious metals investing. There is less a chance for large losses in these areas, so they make better investment options for beginners.

 

 

Rate this post