Gold vs. Silver as Precious Metal Investments

Posted on November 9, 2015 By

When it comes to investing in precious metals you want to make the right choice. A lot of people ask what the difference is when investing in gold vs. silver. The simple answer is gold has a higher value. The full answer is a little more complex than that. Here are some of the details to help you make an informed decision.

Value

Between the two gold is the most valuable of the two. During market hard times gold tends to have a better price. The advantage of silver is that because it has a lower price you can typically buy more of it.

Currency

While gold and silver might be the oldest currencies in written history it depends where you live as to whether or not you can use it as a legal currency. Each state has the legal right to determine whether or not gold and silver are a precious metal. If you are looking to invest in a precious metal that is a legal currency gold is the most recognized of the various precious metals out there.

Demand

Gold is in higher demand by both private parties and central banks. This means that there are a lot of people buying up gold. Silver is significantly less sought after by central banks and fairly less sought after by private parties.

Production

Every year there are projections made for the production of all precious metals. Recently gold is expected to be on course for its regular project. Silver on the other hand is projected to exceed projections significantly. This may sound good but it isn’t. This means that the market will be flooded with silver.

Price Markups

Gold and silver both have an spot price. This is essentially a set price based off of the average sell price of the respective precious metal. If you are worried about price markups then how much you are looking to purchase will help you to determine which metal to get. When you are looking to invest under $1,500 silver tends to have the least markups. Gold is the better option when it comes to wishing to invest in over $1,500.

No matter which precious metal you are looking to invest in you should always make sure to do some research into current market value and what average markups are.

Mass

When it comes to storage and shipping you want to get the most bang for the least space. Gold is the denser of the two metals meaning for the same size you get the most value out of the size. This also means that gold is easier to store because the value for the size is higher. You don’t need to pay as much to store the same value in gold as you would in silver.

In short gold is cheaper to store and transport because a smaller amount is needed to get the same value as a larger amount of silver.

Liquidity

Liquidity is the one area where gold and silver are almost exactly the same. While it will fluctuate depending on the market, both gold and silver are amazingly liquid in nature. That means when it comes time for you to sell them it is extremely easy. Because of the invention of the internet you can buy and sell gold no matter what time it is, no matter where you are. There is also always people looking to buy both.

Many traders and sellers will buy gold from you to help replenish their stock. Be careful to ensure that you are getting the best price when you sell your gold or silver through a trader.

Reliability

No matter what throughout recorded history gold has always been worth more when pitted ounce to ounce. This means that gold has always been able to hold a value that silver has not been able to meet. Because of this many people consider gold a super investment because they don’t have to worry about it dropping below the price of other precious metals.

As for general reliability on the market gold and silver are both great options for investments because when the rest of the financial world is at its lowest both gold and silver shine. This is a trend that has upheld throughout the years. It is due to the fact that in times of uncertainty people want an investment that is more than just paper or a digital hold. Gold and silver both give them that.

When it comes down to picking whether gold or silver is right for you there is only one person that can decide, you. Both precious metals have their benefits.

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