• 16 hours Trump Tweet Sends Oil Soaring 25%
  • 1 day Why The Coronavirus Economic Crash Is Worse Than You Think
  • 2 days Is A Global Currency Necessary?
  • 2 days America Has Shed 500,000 Millionaires Since The Coronavirus Lockdown Began
  • 3 days Trump Wants Another $2 Trillion Economic Intervention
  • 3 days The Surprising Businesses Deemed “Essential” During The Coronavirus Lockdown
  • 4 days Priceless Van Gogh "Spring Garden" Painting Stolen
  • 4 days Oil Falls To $20 For First Time In Nearly Two Decades
  • 4 days COVID-19 Could Be The End Of U.S. Coal
  • 4 days How Much Does Your Social Security Number Cost? $4 On The Dark Web
  • 6 days Silver Stocks Have Been Decimated In The Coronavirus Sell-Off
  • 6 days How Blockchain Tech Could Make Mergers And Acquisitions More Efficient
  • 7 days America’s Shortage Of This Metal Keeps Trump Up At Night
  • 7 days Bidet Bonanza: Defying The Toilet Paper Shortage
  • 8 days U.S. Auto Sales Fall By 75%
  • 8 days Violating Quarantine? Big Brother Is Watching
  • 9 days Does Gold Still Have Some Room To Run?
  • 9 days Major Acquisition Gives The World’s First Green Ride-Share Another Edge
  • 9 days U.S. Pushes For Digital Currency For Immediate Stimulus
  • 10 days The Impossible Challenges Created By Growing Population
What's Behind The Global EV Sales Slowdown?

What's Behind The Global EV Sales Slowdown?

An economic slowdown in many…

How The Ultra-Wealthy Are Using Art To Dodge Taxes

How The Ultra-Wealthy Are Using Art To Dodge Taxes

More freeports open around the…

Chris Vermeulen

Chris Vermeulen

Chris Vermeulen, founder of AlgoTrades Systems., is an internationally recognized market technical analyst and trader. Involved in the markets since 1997.

Contact Author

  1. Home
  2. Markets
  3. Other

Is Silver a Better Bet than Gold in the Near Future?

Last week, the beginning of April 18th, 2016, silver was on fire, rising sharply and forcing 'Wall Street' to take note of its move though, many investors believe that gold and silver are one and the same, one can hold either in your portfolio and earn the same returns? the truth is far from that!

In reality, though both silver and gold are considered precious metals and over the long-term, they have a high degree of 'correlation' in their movements, but in the short-term, for the active investor, both offer opportunities at different times.

From the chart below, it is clear that once the bull market starts in precious metals, silver beats gold hands down. From 2005 to the highs in 2011, gold returned an impressive 350% returns, whereas for the same period, silver recorded an astounding 700% return.

Gold and Silver Chart 1

My subscribers are aware that we are extremely bullish on the precious metals over the next few years, when the global economies enter 'The Great Financial Reset'. Gold will be in a sustained bull market for years to come and will reach levels which now seem unbelievable.

History suggests that if gold witnesses a resounding bull market, silver will outperform it.

However, occasionally, investors will benefit if they trade in and out of both these markets. At times, holding silver is more profitable than gold and at other times, it is the other way around.

Consider this, if one would have bought gold, during the start of this year of 2016, one would have made an impressive 16% returns in the first two months' as shown in the chart below. However, silver would have returned a 12% return for the same two-month period.

Since then, I raised a 'red flag' regarding a short-term top developing in gold and gold prices have been range bound with a downward bias.

On the other hand, silver has taken off, on April 18th, 2016, netting an investor a 16% gain in this month, which beats most other asset classes, including gold. Today, 'Commercial Traders', as determined by their large position, which we have not been this bearish on silver since 2008. This is when silver traded from $21 per ounce all the way down to $8 just before silver had a multi-year rally topping in 2011. They set a new record short position last week!

Gold and Silver Chart 2


Concluding Thoughts:

In a couple days I will be posting the second half of this article here on this website to show you what exactly is likely to happen and when for both gold and silver. Trading and investing is not as simple a many think. Just because you or someone you follow is bullish on an investment does not mean it is a good buy or should be bought. Timing is everything in the markets and knowing when and where to buy and sell is the key to long term success.

The big question you should be asking your self is if precious metals are headed lower? This I will share with you in a couple days, stay tuned.

 


Get my analysis and trade ideas delivered to your inbox by visiting www.TheGoldAndOilGuy.com

 

Back to homepage

Leave a comment

Leave a comment