Top Reasons to Invest in Silver Coins

Over the centuries, silver has been of great use to humans in several ways. Whether as currency, industrial raw material, or investment commodity, the demand for silver will only continue to rise. Are you considering investing in silver coins? Here are the top seven reasons you should.

1. Real asset
The silver coin is a real tangible asset. It is actually real money with intrinsic value, unlike fiat money. Its value is a function of its silver content and not dependent on any government’s regulations or promise contrary to paper assets. As a result, it can be used as a hedge against inflation and monetary crisis. A lot of investors used it to hedge against the 1960s and ‘70s inflation.

2. Liquidity
The silver coin is easily available. It can be bought and sold with ease. You can even buy it online from some big online stores like Amazon. In some places, it can still be used technically as legal tender — as it has been for thousands of years. Furthermore, the fact that silver comes in small denominations when compared to gold, means you can easily sell a few to meet your small financial needs without liquidating a great bunch of your precious metal investment. This is unlike gold where you need to liquidate over a thousand dollars worth of investment — an ounce, the least sellable unit is about $1200 — just to solve a-few-bucks need.

3. Affordability
Silver is cheap and more easily affordable than gold which currently sells at $1271.00 per ounce. Rather than wait until you have over a thousand dollars to buy an ounce of gold, you can acquire a few ounces of silver with less than a hundred dollars. At a price of $14.77 per ounce, silver currently sells at 1/86th the price of gold — yet offering similar protection against inflation and monetary crisis. This shows that silver is greatly undervalued at the moment and thus provides a good investment opportunity.

4. Increasing industrial demand for silver
Silver has found use in several industries such as mobile phones, computers, cameras, solar energy, batteries, electronics, medical equipment, automobiles, and even plastics. The physical and chemical characteristics of silver make it very unique such that it is almost impossible to find a viable alternative. Silver use is so diverse that it is almost impossible not to make use of a silver-containing product each day. Its industrial use and demand keep increasing by the day with the world’s interest in clean energy especially with emerging economies like China and India moving towards green energy.

5. Potential decreasing supply
New silver exploration and mining are currently experiencing a decrease following the fall in silver price since 2011. Most mining companies are reducing their activities in further exploration of new silver mines. This has lead to a gradual but steady decrease in silver supply in recent years. Logically, increasing demand and decreasing supply will soon push the price of silver up.

6. World governments keep less stock of silver
Most countries’ governments no longer keep silver inventory. Only the United States of America, India and maybe Mexico and China still have significant silver stockpiles. This is a real opportunity as it shows the potential scarcity of the precious metal. A scarce commodity is a valuable commodity.

7. The gold/silver price ratio is currently very high
The ratio of the price of gold to that of silver at the moment is in the region of 86:1 which is very significant considering that the mean since the turn of the century is in the region of 62:1 at an all-time high. In fact, this is about the five year high. This is showing how greatly undervalued silver is at the moment. The implication is that there may be a bull market in silver soon.

In conclusion, the price of silver is showing great potential for appreciation in the near future. This is because not only is silver cheap, affordable, and highly liquid but also there is an increasing industrial demand and a potential decreasing supply which may create scarcity and drive the price up. Furthermore, the gold/silver price ratio is around a five year high signifying how undervalued silver is at the moment. This may be a rare opportunity for investing in silver coins.