‘Should I invest in gold or silver?’ is a question that comes up a lot. In fact, a friend was asking me about it just this week. So let’s try to resolve it here and now, once and for all: gold or silver – which should you buy? Full disclosure: in my own portfolio at one stage I was geared as much as 70% towards silver and 30% towards gold. But in 2011, when silver went to $50, I rolled into gold and never went back. My physical allocation is now probably something like 90% gold and 10% silver. To be clear, we are not talking about mining companies, which are a different kettle of fish altogether – just physical metal.
Silver has a great deal more potential than gold. There is every possibility that the silver price could triple or quadruple from today’s price of just below $30 per ounce (oz). It could even go to $200. But my experience of 20 years’ investing in silver is that if it can find a way of disappointing, it will. The out-and-out silver bugs all scream manipulation, and maybe the silver market is manipulated and suppressed. Certainly, if all the longs on the futures exchanges were to hold out for delivery, the silver price would go shooting up. There is not the physical supply to deliver on all the contracts. That applies to many commodities, although to none, it seems, as consistently as to silver.