Some Basics of Investing in Silver

It's no secret that silver is one of the most popular metals that people invest in. Compared to the other popular metal for investment (gold), silver is relatively cheaper, though its prices are notoriously more volatile. Today, we will look at some aspects of silver from an investment point of view.

In 1840, one troy ounce of silver was priced at USD 1.296 and the gold/silver ratio was 15.93. This means that one troy ounce of gold was equivalent to 15.93 troy ounces of silver in 1840. In 1930, the price of one troy ounce of silver fell to a paltry USD 0.330 with the gold/silver ratio at 62.58. Ten years later, one troy ounce of silver costed USD 0.348 while the gold/silver ratio rose to an astounding 97.27. By 1980, the price of silver reached USD 16.393 per troy ounce and the gold/silver ratio dropped to 37.37. In 2009, silver is priced at USD 16.44 per troy ounce with gold/silver ratio of 64.45. Now, you will understand why people say the prices of silver are so unpredictable.

Just like all other commodities in the world, the price of silver is largely driven by demand and supply. When the Hunt brothers tried to manipulate the price of silver in 1980, they purchased a big volume of the metal, and they succeeded in shooting the price up to USD 49.95 per troy ounce. Later, the NYMEX and Federal Reserves put a stop to their exploits. Perhaps, the most storied purchase of silver happened in 1997 when Warren Buffett bought a whopping 130 million troy ounces of silver at the price of USD 4.41 for each troy ounce. In 2006, he declared that he had no more silver when the price of silver reached USD 11.5452 per troy ounce. Can you guess how much he made?

Down here, you don't have to guess much about anything. If you have some good silver for sale, a good silver buyer would be pleased to look at them. Then, you can get your instant cash for silver!