Recently, silver has become the new gold. There are a number of reasons why investors have turned to silver as a way to diversify their portfolios. For one, history has shown that gold and silver have held their value remarkably well, even in times of economic crisis and upheaval. Therefore, when stocks end up having a bad run, gold and silver prices shoot through the roof.
However, owning silver to protect against financial ruin should paper currency devalue and investing in silver in order to make a profit are two different things. Investing in silver is about speculation. In order to make a profit, it would mean selling silver for a higher price. But, because of silver's 80% gain in 2010, investing in silver may not mean a large profit, unless the economy should take a serious dive. Possible investors should consider that even larger gains are expected in 2012 for both gold and silver, with some speculations suggesting $60 an ounce by the end of the year.
This shouldn't discourage those who want to invest in precious metals. Silver is certainly a fantastic option, especially compared to other precious metals. There is less speculation with silver compared to other precious metals, it requires less capital, and it can be sold to anyone who makes an income being that small amounts are affordable. Recent studies have also shown that individuals who invested in silver have made larger gains compared to those who invested in gold.
Investing in silver not only provides the opportunity for potential profits, but it means financial security should economic troubles occur. Investing in anything requires speculation that prices will increase in the future, and while stocks allow investors to collect dividends and profits, they are subject to the volatility of the market more so than silver.