Gold vs Silver: A Comparative Guide for Investors

gold vs silver
March 20, 2023
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                 Inflation has been on the rise across the country over the past year, which has caused many Americans to become worried. If you're looking for an investment that can help serve as a hedge against inflation, you might be looking into investing in precious metals.

There are several things you need to understand about this kind of investment before putting any money down. The most important thing to get familiar with is the difference between different kinds of precious metal investments.

What's the difference between investing in gold vs silver, for example? Knowing how to compare an investment in these two popular forms of precious metal can be key for any novice investor.

What do you need to know? Read on and we'll walk you through the basics.

The Basics of Gold Investments

Investing in gold is something that almost every serious investor takes the time to learn about.

Gold has had value to human civilizations for thousands and thousands of years, and today it remains one the most important and ubiquitous value holders on the planet.

Gold is unique as a precious metal because it does not rust or corrode, it conducts heat and electricity, and it's very malleable. That and its beautiful color have made it popular for construction, jewelry, and as currency for all of history.

Gold prices are not so much driven by supply and demand like most things. This is because most above-ground is hoarded by collectors, and far outweighs the amount of gold that can be mined from below ground.

This being the case, gold prices are mostly controlled by existing gold owners. When gold owners start selling their product all at once, the price of gold falls. When hoarders begin to buy gold, the prices push upwards.

Gold is seen in the eyes of many investors as the safest store of value. Gold value might change somewhat, but it's reliably always somewhat valuable. The same can't necessarily be said for banks and paper currency.

Gold tends to maintain its value against inflation, which is why many investors keep it as part of their investment portfolio. As prices rise around the country, more and more investors might turn to gold to help hedge their bets when it comes to their overall valuations.

The ability to physically hold gold in one's possession also tends to be a reason that some people invest. Growing distrust in large financial systems has left many people feeling like they'd prefer to have their own physical grasp on their wealth.  

The Basics of Silver Investments

There are a lot of similarities between gold and silver investing, but there are some key differences as well.

Unlike gold, silver's value also has a lot to do with its role as a popular industrial metal used in all sorts of construction and industry. This more practical use, in addition to its use as a store of value, impacts how the market for silver tends to move up and down.

These competing purposes tend to push the price of silver up and down with more fluctuations than one might experience when investing in gold. The silver market, to put it simply, tends to be more volatile.

The market also tends to be smaller than the gold market, which means movements in the overall supply can have more significant impacts on the current asking price.

Silver is most often used in appliances, medical products, and other industrial items that are popularized amongst the middle class. Silver is a helpful electrical conductor and has found itself as part of a piece of many different inventions and products.

Most batteries use at least some percentage of silver in their creation.

Roughly 56% of the silver supply is currently used in manufacturing projects of one kind or another. For this reason, silver is also more tied to broader economic ebbs and flows.

Of course, silver is also used in jewelry and as a classic store of value and has been for a great many years. People invest in silver as a hedge against inflation just as they do with gold, and the advantages of this investment are in many ways silver to that of the other popular precious metal.

Silver Tends To Be More Affordable

One of the major differences you might want to consider when investing in silver or gold? Silver provides many of the same benefits, but at less of an ask to your wallet.

Yes, it's obvious that silver is cheaper to buy because it's less valuable than gold. But there's more to it than just that.

Like gold, silver is a hard investment that you can possess, use as currency, has no risk of default, and so on. However, you're likely able to get more for your asking price when you decide to go with silver - which is often referred to as the poor man's gold.

You may be able to get some larger amounts of gold at a decent price, but the smaller amount you're getting, the more you'll be likely facing some higher premiums for your purchase.

This is because gold refineries spend the same amount to produce a ten-ounce coin as they do a one-ounce coin. Those costs are going to carry over to you. Silver, on the other hand, you are not as likely to run into this kind of problem.

Silver's lower prices can also have a utility when it comes to actually use this stored value. Liquidating your gold investment can be a big task as it likely means taking in a huge amount of cash at once.

The lower cost of silver allows you to liquidate and use the value for smaller, more reasonable purchases.

Gold vs Silver Storage

Another factor to consider when you're getting ready to start precious metal trading? Silver will require more involved storage than gold.

If you're looking to retain the same value in silver as you would with gold, you're looking at a whole lot more physical material. You're going to need to find a place to store all of this silver, and it might not be a problem if you had a more condensed gold collection.

In addition, you have to be much more careful when it comes to storing a silver investment. Gold is incredibly durable and it does not tarnish. Silver, on the other hand, will tarnish over time if you are not careful.

If you don't have a storage solution that will keep your silver away from air and moisture, it's likely to lose its luster. This can have an impact on its overall value.

Gold can stand up to these environmental threats, making it easier and more affordable to store without having to worry about this kind of problem.

Should You Invest in Gold or Silver?

While there are many similarities between gold and silver trading, the above differences should make it clear that you need to be careful when deciding between investing in either gold or silver.

You'll need to look at your own specific situation and needs to help make a decision whether to opt for silver or gold (or to invest in both, even).

At the end of the day, the value of gold is much higher than that of silver, and it will accomplish the many benefits of precious metal investing better than silver could. You'll also have the benefits of easier storage, transport, and care.

In addition, you'll have a stronger hold against the rise of inflation, and you'll have to worry less about volatility over the length of your investment.

That being said, depending on how much you have to invest and how much volatility you're willing to stomach, an investment in silver still might be worth considering.

It all depends on your needs and preferences - but this information can help provide the background you need to make an informed decision.  

Deciding on the Best Investing Strategy

If you're new to the world of precious metal investing, there's a lot to get familiar with. One of the best places to start is learning the difference between gold vs silver investments.

The above information can serve as a handy primer on the main distinctions between these two popular forms of precious metal investing. Gold and silver each carry their own pros and cons, and knowing these differences will make you a better investor.

Have more questions about investing in gold? Looking to start investing while the time is still right? Drop us a line anytime and we'd be happy to help.


There are several things you need to understand when comparing gold vs silver investments. Keep reading to learn what is right for you.

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