Should I Buy Silver as well as Gold Bullion?
Many investors spend time deciding whether to buy gold or buy silver, but the savviest investors own both. While gold can offer the ultimate insurance and protection against uncertain economic times, silver is a more speculative investment. Both metals are commonly invested assets, but silver is an entirely different investment which can realise substantial profits despite the initial VAT outlay. It’s because of these differences that owning both gold and silver together can be beneficial.
A Speculative Investment
Silver does not offer the same level of security that gold does due to its price volatility. However,
the constant fluctuations result in more opportunities to buy and sell at profit, making it a more
speculative investment. History tells us that silver is a riskier investment than the safe haven of
gold, which has consistently preserved and increased the value of money.
Silver has proven to be a very good investment. In the three years between December 2008 and
December 2011, the silver price increased 233%, substantially outperforming any other investment
type such as stocks, property and even gold.
While the price is currently quite low compared to 2011's peak, it's common for markets, shares, and
other investment options like bullion to alternate between bullish trading (keen demand) and bearish
trading (limited demand). Usually prices hit a high or low point before they become too expensive to
back or too cheap to ignore, and then the market flips.
A Long Term Investment
Unlike gold bullion, all silver bars and coins are taxed at a rate set by national governments.
Paying Value Added Tax or VAT often encourages investors to turn to gold. However, it is
advised that buying silver is very much a long term investment and should be owned for at
least 12 months.
Ideally, silver investments should be kept many years, purchased with money you can afford
to keep in the metal until such time the price has risen enough to cover your initial outlay.
can offer an effective way of diversifying an
individual’s investment portfolio, therefore spreading risk and providing additional protection
against other investments.
Despite the current low price of silver it is widely thought that silver will continue
to strengthen in price and demand due to the fact that silver is still widely used in industry
despite its status as a precious metal. More and more tech is using silver in a variety of
forms; in electric cars, solar panels, and in the newest computers.
Easy to Exchange
With the world economy looking uncertain following the pandemic and invasion of Ukraine, many
to buy silver as an alternative form of currency to protect themselves against any possible situation
where money loses much or all of its value.
It's more than a bit of a stretch to say that fiat currency (Euro coins and notes) will be scrapped
by the European Central Bank and the economy will collapse, but the point is that many national
bullion coins DO have a face value and ARE legal tender in the event some disastrous
event does happen.
With this in mind, silver offers a different option to gold as small units of silver, such as 1oz coins,
provide the ideal currency to exchange or pay for everyday items due to their relatively small value
per unit. In comparison, gold coins and bars, which are around 75 times more valuable than silver,
would be better used to exchange for much larger items or assets.
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