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Is Gold or Silver the Better Investment?

The intangible allure of gold has helped it dominate headlines for more than a decade, yet more investors are now focusing their attention, and funds, on silver. Sometimes referred to as “the poor man’s gold” silver has at times outpaced gold in terms of profit, and many precious metals market analysts have predicted that silver will be more profitable than gold because of various reasons. However, when one thinks of wealth one thinks of gold, not silver. Which metal, therefore, is the better investment?

The answer lies with the investor. Yes, there is something about owning physical gold that speaks to one’s success, but as investors should we allow ourselves to be ruled by emotion and ego? Silver has increased by more than 20 percent in the same time that gold has increased by about 7 percent. However, gold is only down by about 17 percent in the last year, while silver is still recovering from a 22 percent drop in the last 365 days.

Silver is more speculative than gold because of its widespread industrial use. Historically speaking, the price of gold is somewhat more controlled and predictable. Investors anxious for the dollar to become truly insolvent may want to buy some silver to buy things like food and gas, although historical precedent says that our government will intervene to outlaw the use of precious metals as currency before such a thing could ever happen.

In short, safety-minded individuals may prefer gold over silver, although having some silver on hand to use as currency may be a good idea. On the other hand, speculative investors might want to focus on silver rather than gold. At the end of the day, however, a combination of gold and silver, along with more traditional investment vehicles, is the best way to laid a solid investing foundation.

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