With silver showing its mercurial side, precious metals investors must be calm

With silver showing its mercurial side, precious metals investors must be calm

July 10, 2012 60 view(s)

July 9, 2012 - Just as gold saw a surge at the end of June 2012, silver also climbed by more than 5 percent, impressing investors who wondered how long it might take the white metal to see another significant gain in price. Like any of the precious metals, changes in price are all part of the long-term investor's reality.

While silver investors today may not be aware of its reputation among the Ancients, there is a reason that its old symbol was a crescent moon. The crescent moon was associated with fickle Goddesses like the Egyptian's Isis due to the fact that it was pliable and could also oxidize and change its appearance, unlike gold. Among the precious metals, silver is noted for its many applications in different industry, even medical uses. Despite this, because so much of it has been and continues to be mined around the world today, its price is more volatile in the markets.

Silver's value lies in many different uses, ranging from jewelry to medicinal purposes to electronics to solar panels and more, so there are many reasons why its value may rise or fall other than its purpose as a store of wealth. While silver is touted as a monetary asset, not all investors think this way; some are more focused on its value to the industries it is used by.

The Strategic Metals Research & Capital's director of mining finance told reporters, "Both gold and silver are a fair value today, neither cheap like the days before 2006 nor expensive like a bubble."

At around $30 per ounce, silver represents a strong addition to a precious metals portfolio right now, say a majority of analysts, and at this particular price level industrial demand may begin to have less of an effect on its value. This means that silver would then begin to perform more like gold which is primarily purchased as a monetary asset. Many believe that since the downside to silver is currently so limited, and expected to remain so in the long term, prices could rise to as much as $50 this year and double within the next few years as silver comes to be seen by more and more investors as a safe haven for wealth.

It appears that the ancients may have had it right after all when it comes to silver's so-called investment personality. However, even today those in the investing world say it is not silver futures, mining certificates or options that build a profile, but an actual store of physical silver bullion or coins.