% ratio is it correct

[craig12]

do you buy silver because of the % ratio?  is that what excites us about this shiny metal  ?

if it was £500 oer oz and gold was £800  would we still buy it  

i have seen videos that state if (and its a big if) silver should rise very quickly then the % ratio will get closer

any thoughts ?  some times you look at the 2 prices and think  eh   70 times more expensive for 1 oz of gold 

does anyone think its the correct ratio?  i know its an industrial metal  , but look at all the jewellry shops etc 

for me it is the excitment of the 70% cheaper option that i like as i dont have too much spare cash

and the gold i can buy is so tiny for the same money 

 

i do always wonder about this though which is very confusing 

they talk about silver will rise when manipulation stops and the paper trades supress the price  

 

but the paper trading isnt going away is it ?

so how can it EVER  be the right price 

dosent it only become £50+ per ounce  if we abolish paper trading ?

[garthy]

I've said this before but if you ask your average Joe " if one ounce of Gold's worth £850 how much would you say an oz of silver's worth?" they always say way more than it currently is, the last guy I asked said £200, that just tells me in the eyes of the public silver is still a precious metal and not a industrial one.

 

Unfortunately because silver's often regarded as being 50% industrial it does come under pressure when say China's GDP has fallen, and as far as I'm concerned it's all down to the futures markets, the futures market was supposed to be a bet on the future price of silver but now for some reason it dictates the spot price, the silver price is also leveraged way higher than gold which may also be a reason for the high silver to gold ratio.

I think the ratio got down to 14 to 1 in 1980 then 40 to 1 in 2011, the question is can it go that low again? I personally think it can but we may have to wait a while.

 

I still believe silver's the better buy at the moment but that's all down to opinions, either way silver has always been and will always be way more than just an industrial metal, but I do feel all this silver industrial talk is a burden on it's price and desirability, but then again you may disagree?   

[SilverBalls]

I know the current rise has only seen a £2(ish) increase per oz but I'm 20 years off retirement and I want that price as low as possible - well, for about the next 20 years.

It is so undervalued.   

 

I'm a small time silver stacker/collector, I don't have any gold. I'd rather have 70 ounces of silver than 1 ounce of gold.

[SilvergunSuperman]

I'm a fairly new stacker of both and have been going with a roughly 66%/33% split gold/silver in value. As much as I like the quantity of silver and the weight of a nice coin or bar in the hand, since I'm buying as a means of saving I don't like the tax and premiums on it. I do believe it will increase significantly in value in time but I can't think of another means of investment that requires an immediate 25-30% loss to get in the game.

 

Gold feels 'special' in my opinion, there's something about holding a lump of pure gold that you don't get with anything else.  I can kind of understand why back in the old days people became obsessed and started wars over it.

[paperponzi]

Age old saying silver is about demand gold is about supply

[ArthGoch]

 

Unfortunately because silver's often regarded as being 50% industrial it does come under pressure when say China's GDP has fallen, 

 

For those that are interested in the composition of silver supply and demand the link at the bottom should make good reading.

 

One interesting fact is the percentage of supply that comes from recycling. The last year of the report (2013)  was a down year for scrap, and even then it was still around 20%. of overall supply. In addition I think a lot of people believe that scrap is principally from the industrial sector but as the Thomson Reuters report shows this is not the case, Jewellery and Coinage are the biggest suppliers

 

One other  top indicator that may be of interest; have a look how Coinage and Bars have grown over the ten year period. Similarly look at the trend for Industrial Fabrication. 

 

Although there is as they say 'lies, damn lies and statistics' I have had first hand experience of working with Thompson Reuters so within degrees I would feel comfortable with any numbers that they come up with 

 

Interesting how governments can continue to maintain that silver is not an investment grade metal when the trend is significantly downward for industrial use and as percentage of the overall total 

 

https://www.silverinstitute.org/site/supply-demand/

[HawkHybrid]

if it is true that the gsr gets bigger during times

when pm's fall and smaller during times when

pm's rise, then the higher gsr indicates that

there is more potential gain in buying silver.

 

this is not without extra risk, so people should

determine what level of risk they are happy with

to determine which combination suits their

personal situation the best.

 

HH

[Shamatti]

[Shamatti]

I made some charts:

 

Gold over 5 years:

 

 

Silver over 5 years:

 

 

GSR over 5 yeras:

 

 

 

[Shamatti]

This is an extream example, but imagine back in 2011 when 1 ounce of gold was worth 35 ounces of silver. Good time to sell 35 ounces of silver and buy an ounce of gold. Sell it in January this year for 75 ounces of silver. Quite some profit! OK, there are expenses with buying and selling, but with volume and large movements in GSR, this is a money making strategy general stackers and collectors are often unaware of.

[HighlandTiger]

Using Shams rough figures, ....

 

In 2011 35 ounces of silver would have cost £986. So in 2011 you could have got an ounce of Gold for an equivalent of just under a £1000. If you had sold that ounce of Gold in Jan 2015, you would have got 75 ounces of silver valued at £916.

 

In money value you would have actually lost a small amount of money, (but not as much as you would have done just sitting on those 35 ounces of silver) and you would have more than doubled your silver holding for nothing.

 

I am aiming to play the GSR over the next 10-20 years through Bullion Vault to increase my PM holdings. I have an equation in mind which I will be keeping to myself, that I will be using to decide when to buy and sell gold and silver in order to buy the other

[Shamatti]

Using Shams rough figures, ....

 

In 2011 35 ounces of silver would have cost £986. So in 2011 you could have got an ounce of Gold for an equivalent of just under a £1000. If you had sold that ounce of Gold in Jan 2015, you would have got 75 ounces of silver valued at £916.

 

In money value you would have actually lost a small amount of money, (but not as much as you would have done just sitting on those 35 ounces of silver) and you would have more than doubled your silver holding for nothing.

 

I am aiming to play the GSR over the next 10-20 years through Bullion Vault to increase my PM holdings. I have an equation in mind which I will be keeping to myself, that I will be using to decide when to buy and sell gold and silver in order to buy the other

 

 

Yes, but as you know, you continue to trade the GSR and you build your stack. As you know, it isn't about a one of long term trade, you continue to role your stock. You change to gold when the GSR is one way, change to silver when it goes the other way. You play the GSR - and it can be very lucrative.

 

I know a guy in Australia who uses forums such as this one to do GSR swaps, and he has built an amazing stack. Always amplifying his PM stock buy building on previous trades. Rarely any cash changes hands, but he has turned a small stack into a big stack with very little outlay. Obviously this has taken a lot of work over many years.

 

Money value does not enter into it. Only GSR. After a few years you can take stock if you like, but you will have increased your actual holdings - regardless of value - for no/little additional expenditure, and that is the critical point. Eventually prices will always go up. I think we all agree on that or we wouldn't be buying PM's. Play this game right, and regardless of monetary value along the way, you can increase your stack for little cash as prices drop, so you have more holding when they rise. It's a tried and tested strategy, and it's genius when it works out for you!