SILVER the ‘poor man’s gold

Silver may represent one of the few cases where cheaper is better — not just when it comes to cost, but in terms of quality for investors. The asset known as “poor man’s gold” is the top performer in the precious-metals space so far this year, and it may have plenty of room to run even higher. As the cheaper, ‘poor man’s gold,’ silver has always been the monetary option of the masses, and in fact has historically circulated more as money, while gold has functioned more as a store of value,” said Brien Lundin, editor of Gold Newsletter. Silver has always been cheaper than gold, yet still highly valued, he noted. This is natural, since the smaller denominations of silver currencies allowed for more efficient usage, Lundin told MarketWatch. So, silver coins were more suited for purchasing bread and other sundries, while gold was more suited for buying a home. Now, silver is the top performer among major precious metals, with prices up 74% year to date and recently climbing to a fresh nominal record high. That compares to a nearly 55% rise in gold 70% climb in platinum and a nearly 54% rise in palladium futures so far this year, as of late Wednesday morning, according to a Dow Jones Market Data analysis of FactSet figures. That says a lot given that much of the attention has fallen upon gold, which climbed to a record-high close of $4,359.40 on Oct. 20. But silver marked a record-high finish too — at $53.46 on Nov. 12 — and it’s poised to mark its best year since 2010. “When gold takes off to the upside, many investors shift toward silver because they can get so many more ounces for the same dollar amount,” said Stefan Gleason, president and chief executive officer at Money Metals Exchange. Silver joins nation’s critical-minerals list But it’s not just quantity when it comes to silver — it’s also quality. Silver has both monetary and industrial features, and each of its “personalities is highly charming,” said Gleason. “Its monetary qualities are time-tested for millenia, and in many languages, the word for silver literally means money.” For example, the Spanish word “plata” can be used to refer to either money or silver. And on the industrial end, silver’s uses are “exploding,” thanks to its status as the “best reflector of visible light, the most conductive metal for electricity and head, and its remarkable effectiveness as a natural biocide,” Gleason noted. The U.S. Interior Department recently added silver to the the nation’s critical-minerals list. Silver is “one of the most useful metals on earth” and it’s historically inexpensive relative to gold, so that makes it a “compelling value play,” Gleason said. Inflation-adjusted value A key difference between the two metals, however, is that while gold earlier this year topped its inflation-adjusted record high from the 1980s, silver has a long way to go to reach its own inflation-adjusted record high of $209.71 from January 1980, according to Dow Jones Market Data.

Silver remains far below its own historical high, noted Will Rhind, CEO of GraniteShares. That gap is “meaningful,” as silver has often outperformed gold during strong bull cycles, he said. “Its current discount implies substantial catch-up potential if the broader precious-metals trend continues.” In Wednesday dealings, the most active December futures contract for silver traded at $50.71 an ounce on Comex — down $159 or almost 76% from that inflation-adjusted record high. Still, silver is positioned to remain among the leaders in the precious-metal markets as long as current drivers persist, said Rhind. “Supply-demand fundamentals remain tight, and investor appetite for hard assets continue to be strong,” he said. And while volatility is “inherent,” with double-digit pullbacks normal, the broader trend remains “constructive.” Inflation is still elevated and long-term confidence in fiat currencies are under pressure, so silver’s risk-reward profile is “compelling,” said Rhind. Meanwhile, silver’s strength has been driven by “both sides of its identity: industrial metal and monetary metal,” he added. That “dual role” allows silver to respond to both manufacturing trends and safe-haven buying, giving it “more torque when both forces align,” said Rhind. The metal’s physical market is also on track for another annual deficit in 2025, its fifth in a row, according to the Silver Institute. Silver has been “undervalued for decades,” Paul Mladjenovic, author of “Investing in Gold and Silver for Dummies,” told MarketWatch. The demand side has increased due to artificial-intelligence-related technology, and smartphone and energy-related needs are still strong, he said, leading to several years of supply shortages. Mladjenovic expects those shortages to continue into 2026 until new exploration yields more supply. Looking ahead, Mladjenovic expects silver to climb to $75 an ounce by the second half of next year. That would mark a rise of more than 30% from current prices. HON BRIAN SCAVO