Silver

Silver Returns vs S&P

-10.30%

Versus S&P

-9.40%

an hour ago

-10.30%

Versus S&P

-9.40%

an hour ago

6m High

6m Low

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Silver

$24.49

$16.97

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S&P 500

4,631.60

3,666.77

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Silver

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S&P 500

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Does not follow the stock market

Sources: SLV, SPX

    Reasons to Invest

  • May provide a hedge against inflation
  • Adds diversification to your portfolio
  • Offers a less expensive way to invest in a precious metal
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Highlights

Good For

Hedge inflation + add diversification

Time Horizon

6-36 months

Diversification

Environmentally Friendly

Silver can be a way to add an element of diversification to your portfolio, thanks to its fairly weak positive correlation with traditional assets like stocks and bonds. It can also offer a hedge against inflation, due to the fact that it's a physical asset with an intrinsic worth, unlike dollars or other currencies. However, because silver is also an industrial metal, its value is heavily influenced by shifts in the global economy, making it susceptible to price volatility. Silver prices have been found to be twice as volatile as those of gold dating back to 1996 as measured by standard deviation. While this volatility can offer the potential for sizable short-term gains, it increases the downside risk and doesn't make silver great as a long-term growth asset.

Volatile but can be good for short-term gains

avg

-0.8%

Avg Annual Returns

Past 10 years

Ways to Invest

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Want to keep it traditional?

Check out Silver in the stock market

Compare Commodities Returns

Risk Score

6M Growth

Silver

SLV

22

-10.33%

Gold

IAU

13

-2.34%

Risk Analysis

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Risk Analysis

As of 08/02/2022

Low

Compared to

S&P 500
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Silver

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S&P 500

Low

To offer a snapshot of silver's volatility during the pandemic, in 2020, future prices rose by more than 47%, settling at $29.418 on February 1, 2021, which was the metal's highest value since February 2013. But then, prices took a big dip, eventually settling at $21.485 an ounce on Sept. 29, 2021, marking silver’s lowest value since July 2020. Because of this volatility, experts don't recommend silver as a long-term investment.

Performance During a Recession

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Performance During a Recession

Silver can serve as a hedge against inflation and as a store of value during an economic downturn, but it does not do so to the same degree as gold. This is because while silver is a financial asset, it is also an industrial metal. Its heavy industrial usage makes it more closely tied to the global economy, causing it to be more prone to price volatility and more likely to decline in value when demand drops off due to a slowing economy. Indeed, the gold-silver ratio (how many ounces of silver can be bought with an ounce of gold) has historically been high during times of economic crisis and market recession.

Drawbacks

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    Drawbacks

  • Potential for high price volatility
  • Vulnerable to shifts in technology
  • More sensitive to economic slowdowns
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How You’re Taxed

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How You’re Taxed

Capital Gains

Capital Gains

Holdings in precious metals like silver are generally subject to capital gains tax. As far as what rate applies, the IRS classifies silver as collectibles, meaning the collectibles capital gains tax rate of up to 28% may apply to both physical silver holdings and silver ETFs. However, this would only apply if you sold your silver holdings at a gain, with the rate also depending on how long the asset was held, among other factors.

Did You Know?

  • poitStar

    First used as a currency in 700 B.C., silver has had a role as a trading metal in almost every culture both ancient and modern.

  • poitStar

    Silver is used across a vast range of industries and is part of almost every computer, cell phone, car and appliance.

  • poitStar

    Over half of silver's demand comes from tech and industrial uses, with the rest coming from investors.

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