Category Archives: Guides

The question of “Will Silver Prices Ever Match Those Of Gold?” is asked occasionally, particularly by people new to precious metal investing. As a commodity like any other the laws of “supply and demand” control the value of silver in comparison to other commodities, gold included. Since most larger countries have moved off the Silver Standard which held the monetary value as a fixed weight of silver, the value has become more volatile. The current major uses of silver are in bullion coinage, electronics, and jewelry. The recent use of silver as a component on computers and cell phones has driven up its value as a commodity making its value higher.

In ancient Egypt silver was more rare and thus more valuable than gold. But once more silver was located in the ancient world, and the smelting processes to refine it were better developed, the value fell. The ratio of silver to gold in value was originally set in a the far past in ancient Roman times at 12:1. In America in 1792, the value was set at 15:1 by law. However, the average value of silver to gold in the 20th century was a much wider ratio 47:1 where it would take 47 troy ounces of silver to equal one of gold in value. The current value is a whopping 59:1 ratio of silver to gold.

However, this ratio is subject to changes in the commodities market. A new industrial use of silver could drive up the price. A decline in the supply due to war or some other reduction of supply could also raise value. An increase in the purchase of silver bullion can also drive prices higher. Because the silver commodities market is much smaller than the gold trading market, the influence of a few key investors is more quickly felt. . A huge scandal ensued in the silver market 1973 when the Hunt Brothers cornered the market in silver bringing its value to the highest in the last 100 years of 15:1. When the Federal Reserve intervened and put and end to this game the price fell again due to more natural market forces. More recently, investors like Morgan Stanley and Warren Buffet have personally affected silver values by buying large quantities at one time

So will we ever see silver match gold in value?

Most likely not unless some thing happens which uses so much silver thus taking it off the market and raising its value. What could do this? Investors could buy up large reserves and hold them like the Hunt Brothers in the 1970’s. A new industrial technique that requires exclusive use of silver could raise demand and thus cause silver to increase in value. Because it is such a good conductor of electricity a new use in the electronics industry is a strong possibility. Because of this potential future in industrial and electronic development a new investor may wish to invest in silver as a way to enter the market to purchase precious metals as an investment. It would require a much lower level of capital. Ask your investment broker for advice on this matter.

Oh Gold…Should i let you go or get lots more of you?

Regarding the question of if you should sell or buy a Gold, it depends on the answers to these questions. What is it for?

Gold is considered as an investment vehicle for the reason that in many years through its ups and downs, its market value is appreciably increasing( Yes! you can make money out of it. So whether you sell and/or buy?, take a look at the market and answer the question “what is it for”.

Two Reasons why you should sell your Gold

1) Investment Purposes – You want to cash out having made money on the gold you purchased previously.

Sell it for additional income for a business venture or another investment, for savings or expense. Gold as an investment vehicle gives you the ability to create wealth. Forecast the present market value of Gold and do compare it for the past value when you bought it (your capital). Have an in-depth study on the trends of its market value. Using these data, you can now compute for your earnings if you may want to sell the Gold this is called capital gains(simply what you gain from your capital).

Studying the trends can give you certain option if the earnings will satisfying to you or not. If not, then wait for other days where the value takes a lot bigger. Take note that it is a healthy selling (if that is what you want) if its percent of gains exceeds the average percent of inflation.  Alos, if you have been collecting gold based jewelry over the years it could be that the gold makes it worth more than you originally paid and, if it is just sitting around not being used you can use the money from it to re-invest.  You can go here for a complete guide on how to sell gold jewelry for cash that will explain the best way to find a gold dealer and get high prices.

2) Emergency Purposes – There are many unpredictable and unwanted events that will surely happen to you.

Unexpected as it is, money mostly is needed when it happens. As an investment, it can be of great help in preparation and assurance.

Two Reasons why you should buy more Gold

1) Investment Purposes – Knowing that Gold’s market value tends to increase overtime, buying gold today or when times where it drops down in value will be a good investment.

2) Personal Purpose – Whatever it is, there people who never mind investing(since they all have the money & felt so secure in their financial future) so they just bought Gold for a hobby or other personal purposes like giving gifts and presence.

Whether selling or buying a Gold, you have the reasons either technically or emotionally.  It’s all up to you at the end of the day.

Gold Futures

When it comes to assets, gold is one of the most popular in the world. The precious metal has proved over the years its worth with an impressive record. Gold investment is a long-term strategy in some situations and in others; it is a short-term investment, e.g. for speculation trades. Anyone looking to dabble in gold futures, a number of options are available to them. This sometimes leaves one wondering which course of action they will take.

There are several strategies when it comes to trading in gold futures. They include the following;

The Exchanges

The first step for anyone wanting to trade in gold futures is to decide on the exchange they will utilize. Three of the most known options across the world include;

Commodity Exchange

The COMEX is a member of the CME group; it offers exposure to a variety of commodities focused on metals that also include gold. One hundred troy ounces represent the standard gold contract whereas the MINY and macro are represented respectively by 50 and 10 ounces.

London Metal Exchange

The LME gives gold rewards curve data to any particular investor that might be interested in having themselves signed up. The investor is able to view the forward curves well in advance, offering them a long-term view on the metal.

Multi-Commodity Exchange

This Indian based exchange offers a variety of different contracts for gold i.e. 1kg for standard gold, 100gms (gold mini), 8gms (gold guinea) and 1gm (gold petal).

Gold trading strategies

When it comes to future gold contracts, a considerable amount of attention is required and therefore, left only to those traders, who are most active. Neglect of one’s position for even an hour may have a dramatic effect on how one’s investment turns out.

The big price drivers of gold are overall demand, inflation and the actions of global banks. One has to learn how to read and interpret the trend in which the market is going.