Silver, and WHY BUY
Precious metals, like silver, are just one of many alternative investment options. Silver is a great investment. With instability in the economy and financial markets due to the coronavirus pandemic, there's been renewed interest in precious metals such as silver.
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Like gold, silver has been on a steady upswing since March 2021. Precious metals can function as the ultimate alternative investment, prospering when other investments become unstable and decline.
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Silver has value in and of itself, as both precious and an industrial metal. But it's otherwise inert. It doesn't produce anything, generates cash flow, or provide a steady income. Silver is more in the realm of speculation than investment. If you choose to invest in silver, you should approach it with the mindset of a speculator. That can be not easy to discern, especially when the price of silver seems to be rocketing to infinity. Most times and in most markets, silver goes flat, trading in a very tight price range.
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Is silver a good investment for your portfolio? That depends on your current investment objectives, your risk tolerance, and how diversified your assets are. Here, we’ll discuss the ins and outs of investing in silver, how to buy it, the pros and cons of investing in it, and how it compares to investing in gold.
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Why Invest in Silver?
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Silver has been around forever, giving people a sense of stability as a rare, limited-in-supply commodity in which to invest. Among the many reasons why people invest in silver include:
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Hedge against inflation: During uncertain economic times and rising prices, people often turn to silver as a way to hedge their portfolios against loss. This is because silver has historically been a less volatile investment, as well as a commodity that has many uses even today——making it a conservative investment option.
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Safe haven: Investors looking for a safe place to put their money have historically turned to silver as a safe haven.
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Diversification: Diversification doesn’t just mean having different stocks in your portfolio. It also means diversifying the types of assets you hold. Investors looking to diversify the asset classes held in their portfolios often turn to silver as a stable option because it’s less correlated to other markets.
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It’s a tangible asset: One way to invest in silver is to purchase silver bars. For many people, having a tangible asset such as silver provides a sense of security over holding intangible assets such as ownership in a company.
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Multiple uses: Silver serves as both a precious metal and an industrial metal. In other words, silver is used as both a form of currency and also has many uses for manufacturing various products.