Most silver trading takes place via futures, spot prices, shares and ETFs. Although silver coins are no longer used as currency today, the price of this precious metal is still rising. This makes silver one of the popular investment opportunities among conservative investors. What affects the price of silver, when it’s the right time to invest in silver, and what ways can be chosen for that? You can trade our proprietary silver spot prices, futures contracts and options via CFDs. Alternatively, you can get indirect exposure via silver company stocks and ETFs by trading.
Unfortunately, a lot of retail traders believe that silver is simply the “poor cousin” of gold. While the two can move in the same direction at times, the reasoning for a move in the silver market can greatly differ from the gold market. There are a lot of benefits to trading silver, especially if you do it in the CFD market where you can do so responsibly.
How to trade silver?
Investing in multiple stocks or ETFs enables you to diversify your exposure across many different companies and instruments, mitigating risk. There are a wide range of ways of how to trade in silver from buying and selling physical metal to trading derivative financial products. For example, the Russian invasion of Ukraine saw the silver price rise as investors reacted to the uncertainty. If you are considering trading silver, you should first think through choosing a quality broker. The comparison between gold and silver dates back centuries, with silver literally coming in ‘second place’ to the rarer metal – marking the runner-up in competitions since the 1800s.
- In fact, some Wall Street Bets users speculate that hedge funds are using the subreddit to whip up a frenzy for an asset that they wish to dump.
- From 1794, the minting of silver dollars in the USA began, it took 80 years, then silver lost this position.
- The shares of such companies are highly volatile, but can give a much higher rate of return than the price of the commodity itself.
- When trading Silver CFD, the trader doesn’t own the instrument but can benefit from the changes in its value.
- Powerful deposits of silver were discovered in Mexico, Bolivia and Peru after Christopher Columbus’ expedition to the New World in 1492.
- Traders have several ways to speculate on silver including bullion, futures, options, ETFs, CFDs, and shares.
Once the economy begins to recover, gold’s value falls back and trades nearer silver’s value again. There are several different ways to trade the silver market, including buying silver coins, investing in stocks and ETFs, and trading options and silver CFDs. Commodity prices can be highly volatile, experiencing wild price swings. Trading silver CFDs is a way to try to profit from drastic silver price fluctuations, though the chance of making large profits goes hand in hand with the risk of large losses. Traditionally, the answer to the question of how do I trade silver was to buy and sell physical silver bullion coins, bars and rounds. Meanwhile, a silver trade definition includes a wide range of financial instruments such as options and futures as well as the physical metal.
Silver trading strategy
The closure of silver mines in major producing countries like Mexico and South Africa during the Covid-19 pandemic provided support to the market as demand outpaced supply. The price of the precious metal doubled from around $10 an ounce to $20 during the 2008 financial crisis, and went on to approach $50 in 2011 for the first time since 1980. One way to invest in silver is to buy bricks, jewelry, ingots, or commemorative coins made of this precious metal. Conversely, in periods of economic growth, silver can decline in value as investors turn to other assets that generate higher returns. There’s also increased demand from consumers, who are seeking to buy luxury goods such as jewellery.
- With an Axi account, traders of all levels have access to top resources to help further improve their skills.
- Discover your first silver trade with a range of tools available in-platform.
- Gold has historically always been worth more than silver, but this relationship isn’t fixed.
- A futures contract is an agreement to buy or sell silver for a set price on a future date.
The advantage is that in the case of differential contracts, in addition to growth, it is also possible to speculate on a decline and it is, therefore, possible to profit in both directions. This means that the trader has the opportunity to earn regardless of whether the silver is thriving, and the price is rising, or vice versa. In this case, it is crucial to correctly estimate the direction in which the price of silver will develop.
Can we trade in silver?
While futures contracts can be used to take possession of the physical commodity, you don’t necessarily have to – they can also be settled in cash. When you trade silver, you’ll be using derivative products to speculate on the underlying market price instead of taking ownership of bullion itself. There are multiple ways you can trade silver with us, including via futures, spot prices, stocks, and ETFs. You can use silver futures and options contracts to gain exposure to the market’s direction without owning any stocks or funds. Futures contracts trade on commodity exchanges and enable you to speculate on the price for a specific amount of silver on a set date in the future.
Investment Limited cannot and will not accept clients from outside European Economic Area and from Belgium, Switzerland and USA. You need to be 18 years old or legal age as determined by the laws of the country where you live in order to become our client. IG International Limited is part of the IG Group and its ultimate parent company is IG Group Holdings Plc. IG International Limited receives services from other members of the IG Group including IG Markets Limited. 1 Deal three or more times in the previous month to qualify for our best commission.