NEW DELHI: Gold is right now everyone’s favourite commodity with prices having crossed $2020 an ounce mark, but silver, its ‘poorer’ cousin in the precious metals’ space may well turn into a more long-lasting investor favourite.
Silver has already shot up from $553.31 a kg on March 6 this year to $906.97 by August 7, a near 40 per cent jump. In India, too, where silver now costs Rs 74,210 a kg, the trend has been similar to global
movements. While both the precious metals act as investment hedges in difficult situations such as the current global recession, silver also has a greater industrial value.
Consequently, as economies recover from their Covid-19 -induced depression, demand for silver ingots is likely to jump, raising prices further. “Silver always had industrial uses far more than many precious metals, but with emphasis on green technologies in automation and elsewhere as economies reopen we
expect greater demand for silver,” said Vikram Sawhney, a leading commodities trader.
Citibank in a note said that it believes silver will be a front runner in the commodities market, banking much on new plans unveiled by Democratic contender for the US Presidentship – Joe Bidden – for running trains, busses and others such as e-vehicles.
“Regardless of US action the world is moving forward to a greener future and silver will play a part as it is essential in building the electronics needed in this new infrastructure … also rolling out 5G networks will require silver. The metal will be a bright spot for some time to come,” agreed Amit Bannerjee, an independent merchant banker specialising in commodity hedge funds.
Banerjee points out that in the aftermath of the Wall Street crisis, too, the world had bet on the two precious metals gold and silver. “They are safe havens, but silver has added advantages,” he adds.
For investors deciding on betting on precious metals, silver can also act “as a hedge against over deployment in gold,” point out analysts.
Now is a good time, but how to invest in silver?
Investors can buy silver in physical form either as ingots or coins or may buy it in e-form through exchanges like the National Spot Exchange Ltd. Silver prices have shot up from $553.31 a kg on March 6, this year to $906.97 by August 7, a near 40 per cent jump. In India, silver costs Rs 74,210 a kg, a trend similar to global movements.