Inflation has been on the uptick recently and that's usually good for precious metals like gold and silver. It's also protection against a weakening dollar. I'm looking to put more cash into precious metals but which one has more upside?
According to the Gold/Silver ratio, gold is still at pretty elevated levels when compared to silver. We're at 80, levels last seen during the financial crisis and the crash of '16. Could this be an early warning signal of another stock market crash? Personally, i'm starting to take profits on existing stock positions and not adding any new ones unless they look very attractive (GE?).
Looking at the silver charts, we've seen a huge sell-off from the top. At $16, that's about a third of the high at $48. For a long term play on no leverage, i think $16 is a reasonable price. Downside is capped at $0 with assumed no holding costs. As for gains, i'd be happy with a doubling of the price in the next 5-10 years. Yeah it's slow compared to crypto, but this is mainly a diversification play with hopefully some upside potential to show for it.
Any thoughts from folks who've invested in either?
