Silver Also Gets A Shining Look
According to an article on MarketWatch, investors are finally giving a thought to ‘gold’s ugly sister,’ silver. Silver has outpaced the yellow metal in recent months by climbing nearly 30% since early February, versus a mere 17% surge in gold prices.
Few analysts believe that silver is yet to receive the attention it deserves. According to Gijsbert Groenewegen, a managing partner at Silver Arrow Capital Management Investors, “Investors are not taking notice yet it looks like the world is far more focusing on gold." He further pointed that silver has to catch-up with gold a bit, since the gold-silver ratio at present is 63, while the average ratio between metals is 52.
Mark O'Byrne, a director at GoldCore, an international bullion dealer, said, “While silver has outperformed gold in recent months, it has massively underperformed gold over the long term." Gold is almost 50% above its nominal high of $850 in 1980, whereas silver “remains at less than 60% of its 1980 high of around $50.” "Investors continue to view silver as gold's ugly sister," Mark added.
One can get a clear picture about silver’s improving ‘quality as money’ by looking at the investment demand in the iShares Silver Trust exchange-traded fund (NYSE: SLV), which has risen 200 metric tons over the last seven days. By Thursday, silver in the trust totaled 9,191.37 metric tons and the trust's average one-year total returns, as of March 31, stood at 32.81%. "Silver's price will be driven by physical demand, not by the futures market, so ETFs like the Silver Trust will be good indicators of that demand," said Julian Phillips, an editor at SilverForecaster.com. After falling 0.68% to $18.99, SLV climbed 1.11% to $19.20 in the pre-market hours.
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