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The Biggest Differences in Investing in Gold and Silver

Being an investor or business industry opportunist, you’ve probably thought to yourself that you have no clue as to what you must buy. Do you buy gold because its gold and the status of it sounds better? Does gold have more value than silver because that’s what we’ve ultimately been taught? Why do investors prefer silver above gold and is there a big difference in both price and value when comparing the two?

These are all questions investors need to be informed about. These minerals are mined from the earth’s crust and are a rarity. Thus, buying gold or silver is like a long-term investment. Not necessarily on paper, but when you buy these minerals, you should know what your buying in to.

Comparing Gold and Silver – The Biggest Differences

  • Silver is in higher demand when compared to gold but is less valuable and least traded with when compared to gold.

That doesn’t make any sense, does it? Growing up, we were taught that gold is ranked the number one mineral when being compared to silver. While that statement is true in terms of value, silver is in much higher demand when compared to gold. Nearly eight times as much with the annual supply of silver reaching a high of 1 billion ounces, where gold is at a mere 120 million ounces. This big difference in demand does, however, not affect the market value, as gold costs much more than silver. Even with its high demand factor, silver reaches an annual value of only $16.8 billion, where gold reaches a value of $148.8 billion. This is due to golds presence in the market. When having a look at the stock market, it is also much more popular.

  • Silver costs less than gold

While silver is very similar to gold, it is to no surprise that it indeed costs less. Both silver and gold are considered hard assets. Silver has an advantage over gold that allows it to benefit from the market at a much more affordable price. Selling silver is also considered much easier due to its low price. It is also more practical for daily purchases and is thus a more convenient investment. It is an ideal investment for those with a smaller budget and those who seek short-term over long-term investment.

  • Gold requires much less storage space than silver

When you purchase gold, the amount you purchase will be much less when compared to silver. While silver seems like a better, more practical option to invest in, it is much larger than gold. Pure silver is about 84% bigger in volume than gold. If you think about that comparison in terms of size, you will be paying a proper price for storage space. The cost of professional storage is much higher for silver than gold. Gold costs 0.385% per month, while silver costs 0.485, which is applied according to its weight.

gold and silver

The Verdict: To invest in either gold or silver?

Both silver and gold are long-term investments in both maintaining a proper value in the market. They have similar aspects. Both are divisible, portable, tangible and are finite. When looking at their affordability, volatility and storage factors, however, the mineral that is best to invest in is gold. While gold costs much more, there are factors such as the storage of silver that will cost much more if invested in long-term. It all depends on what the investor is looking for and as well, the use they have for these minerals. If one seeks a long-term investment, gold is the way to go but if you’re on a low budget and just interested in trading on a daily or short-term basis, silver is the preferred mineral.

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