Silver may be in gold’s shadow much of the time, but the investment world has certainly taken to this “poor man’s” metal. A variety of silver exchange traded funds (ETFs) can give you the exposure you want according to your tastes.
Last year, silver prices gained 53% in value, recording its highest average annual price since 1980, explains Tony D’Altorio for Investment U. But many feel that silver’s run is far from over and expect prices to go even higher this year. [Why Silver Is Always a Bridesmaid.]
Reasons this shiny metal is in a prosperous position:
- This year, mine production is expected to increase modestly. The World Silver Survey shows that further scrap and government supply reductions should offset the increase in supplies from mines, leading to little overall change in supplies.
- The metal actually has a number of commercial and industrial uses. That includes in the automotive, solar power, photography and jewelry industries. As industry rebounds, silver prices should move in lockstep. [Gold ETFs Calm in Crisis.]
- Silver oxide batteries, silver conductive inks in electronics and silver nanotechnologies in medical applications are all gaining traction in their various markets. Scientists are still discovering new ways to use these new technologies.
- Silver investment demand should remain strong this year when you factor in a sovereign debt crisis that could have a contagion effect. Silver is an alternative safe haven to gold and can be more affordable. [Silver Is a Haven and a Hedge.]
- Emerging markets are increasing the overall demand for the metal. China, for example, accounts for about 70% of the world’s total industrial usage of silver.
For more stories about silver, visit our silver category.
- iShares Silver Trust Fund (NYSEArca: SLV): Physically-backed by silver
- ETFS Physical Silver Shares (NYSEArca: SIVR): Physically-backed by silver
- PowerShares DB Silver (NYSEArca: DBS): Holds silver futures contracts
- Global X Silver Miners (NYSEArca: SIL): Holds stock of silver miners
Tisha Guerrero contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.