David Franklin, a market strategist with Sprott Asset Management, points to silver’s relative affordability and industrial usage as factors that has helped bolster silver demand.
Silver is used in consumer electronics, medical equipment and industrial catalysts. According to the CPM Group, industrial demand should reach 838 million ounces, up about 3% year-over-year.
Investment demand for silver, on the other hand, accounts for 24% of overall demand, up from about 4%in 2003 after the introduction of ETFs as a liquid trading source. Additionally, silver investors typically include small investors, whereas large institutional investors have steered toward gold ETFs. [Technical Help for Silver ETFs…Maybe]
For more information on silver, visit our silver category.
Max Chen contributed to this article.