Eric Sepanek
SBC Founder
Eric Sepanek is the founder of Scottsdale Bullion & Coin, established in 2011. With extensive experience in the precious metals industry, he is dedicated to educating Americans on the wealth preservation power of gold and silver.
Silver might be the shiniest investment right now for investors to consider, according to Australia and New Zealand Banking (ANZ). Gold’s sustained, record-setting surge has justifiably received the lion’s share of attention, but silver is revved up for its own rally. Soni Kumar, ANZ commodity strategist, recently stated that silver is “set to outperform gold” in the near future – a green light for investors to increase their exposure to the shiny metal before prices move higher.
Silver’s Time to Shine
The Australian Financial Review recently published ANZ’s bullish outlook for silver. Kumar acknowledged gold’s surge while positioning silver as the next precious metal to experience sustained growth. He noted, “Silver remains an affordable alternative to gold,” highlighting its significantly lower per-ounce price – a factor that has historically drawn in budget-conscious and beginner investors.
However, a lower price doesn’t equate to lower returns. In fact, it may offer silver an edge in terms of percentage gains. Because silver’s price is lower, even modest movements in its spot price translate into higher percentage returns compared to gold. Kumar projects silver prices could hit $34 by 2024, representing nearly a 15% increase from this year’s average of $29.58.
Strongest Asset in 2024?
Silver tends to linger in gold’s shadow, but its performance doesn’t always come in second. In fact, silver has been one of the strongest-performing assets this year, posting impressive returns outside of the spotlight. Silver has yielded higher returns than gold, the stock market, and even the Magnificent 7. Since January, the shiny metal has grown from around $24 to roughly $32, representing a 33% rise. From trough to peak, silver has grown from $22.08 to $34.86 — a booming 45% jump.
These recent gains aren’t short-term pumps, either. They’re part of a broader upward trend over the past few years. Recently, silver surfed to a 12-year high which highlights the metal’s sustained growth.
What’s fueling silver’s rise?
ANZ underscores a few economic catalysts behind silver’s current rise and its expected growth down the road:
Gold Rally
As the most popular and widely traded precious metal, gold’s price action sets the tone for the rest of this asset class. With the yellow metal topping several new peaks throughout 2024, many experts are suggesting silver is going to follow suit. As mentioned before, silver is already ahead of gold in terms of YTD yield, and there’s still plenty of room to run, according to ANZ.
Heightened Demand
Silver demand is on the rise, and experts anticipate the buying to continue. The bulk of this boom is expected to come from the various industrial uses silver offers. Some experts anticipate solar energy alone will eat up nearly 100% of annual silver reserves. The demand seen from investors only compounds the impact of the growing appetite for the shiny metal.
Supply Shortage
As demand climbs, the supply side of the market is also seeing pressure. Silver deficits are on the horizon, many experts warn, as supplies struggle to keep up with increased buying. This imbalance between supply and demand will prop up silver prices as investors progressively outbid for limited resources.
“We’re seeing a noticeable squeeze on the product supply [silver]. More and more people are buying; fewer people are selling.”– Precious Metals Advisor John Karow of Scottsdale Bullion & Coin