Patrick Heller of Coin Update News thinks a buy signal can be found in investor sentiment regarding silver. Back in 1980, when silver hit its all-time high, Heller remembers silver would be a topic of conversation in any and every circle. Taxi drivers and barbers would tell strangers that silver was a good investment.
Looking back, Heller believes that such bullish sentiment was a sell indicator. But today, such sentiment has yet to emerge. Rather, it has been bearish. The HGNSI, which measures positive versus negative sentiment, was at 9.2% on July 28, which falls towards the most negative range of sentiment over the past several years.
Lastly, Luke Burgess of iStockAnalyst thinks a silver bull market in China could help propel worldwide silver prices up. The key is that China’s silver market has become increasingly deregulated, which has led to booming global investment interest. China is now the third largest producer of silver.
In addition to the China factor, Burgess recommends buying silver based on these five points:
- Investment demand for silver has skyrocketed 522% since 2007.
- World governments are hoarding silver; official sales have plummeted 83% in the past three years.
- Above-ground silver supplies dropped 86% last year.
- Industrial demand for silver has increased over the past decade, despite a 236% increase in prices.
- Silver outperforms gold during bull markets.
As you can see, there are a number of ways to play the metal – miners, futures, physically-backed and leveraged/inverse.
- iShares Silver Trust (NYSEArca: SLV)
- PowerShares DB Silver Fund (NYSEArca: DBS)
- ProShares Ultra Silver (NYSEArca: AGQ)
- Global X Silver Miners ETF (NYSEArca: SIL)
Sumin Kim contributed to this article.