If you’re looking to get into precious metals then you shouldn’t waste time by wondering whether to buy gold or silver. The truth is that you should buy both, as well as at least one of the other precious metals like platinum and rhodium if you can. Head to this website to find out more about investing in precious metals before you make any moves, though, as well-informed is well-prepared.
Of course, the first thing you’ll think when you look at silver is that it’s not as valuable as gold. On average, gold is worth 90-100 times as much as silver, weight for weight; silver is also a lot more volatile than gold. This might make it look as if silver’s not worth the bother, but this behaviour is what will make silver work for you if you know what you’re doing. It’s also important to add another commodity into your portfolio.
Silver’s great volatility means you can make more profit
The fact that silver is more unstable than gold means that while the peaks and troughs in its spot price aren’t as lucrative as gold’s, their frequency gives investors more buying and selling opportunities. Silver is simply better for speculation than gold – you just need to have good timing and you’ll soon turn a profit.
What about silver for long-term investments?
The Internal Revenue Service sees precious metals as collectibles for tax purposes. If you sell your collectibles and make a gain on them before you’ve had them for 12 months, then your gains are seen and taxed as ordinary income – short-term gains. If you’ve held the collectibles for more than 12 months and you make a profit when you sell them, they’re classed as long-term gains and they’ll be taxed at a maximum of 28%.
If your federal tax bracket is 28% or more then your long-term gains will be taxed at no more than 28% and if your tax bracket is lower than 28%, you’ll be taxed on these profits at the same rate.
Using silver as a diversifier
You can use silver bars, ingots and coins as diversifiers, which is essential to a healthy, balanced portfolio. Diversifying your portfolio spreads your risk and so if one asset takes a dip, the others will either hold firm or rise and balance everything out. Silver is a good commodity to use because it’s not just used for jewellery; it has lots of medicinal and industrial uses, with more being found each year.
Silver can be much more flexible than gold and other precious metals
Lots of us are worried about the global economy at the moment. Hopefully, these worries will stay theoretical, but you never really know. Gold is the metal of first choice for lots of preppers, but silver is a good second choice because of its smaller value. If you need a ride somewhere, or you need to buy groceries while the ATMs are still down, a small bar of silver worth $40, is much more use than an ounce of gold that’s worth well over $1,000. It’s always a bad idea to cut up gold bars…