Silver is a famous and revered precious metal that has helped people gain financial freedom. It’s second behind gold, one of the most popular and oldest choices for commodity investors and traders.
You’re reading the right article if you’ve been on the fence about silver trading or are a newbie trader looking for good reasons to start trading silver. After reading, you’ll know what silver trading is and why you should try it out.
What’s Silver Trading?
| Silver Spot Prices | Today (6th June) | Change |
| Silver Prices Per Ounce | $22.16 | +0.21 |
| Silver Prices Per Gram | $0.71 | +0.01 |
| Silver Prices Per Kilo | $712.77 | +7.39 |
Image Source: Monex
Silver trading online is an investment opportunity where anyone can earn off the value of the coveted commodity. It’s a great alternative to buying silver bullion or bars, helping you avoid fraudulent traders and the logistics of owning silver bars.
Diverse ways for trading silver are via the stock exchange by buying into companies that mine silver. Trading on price changes with Contract for Difference (CFDs), silver futures and options, and silver-related ETFs are more ways to trade silver online.
The primary mechanics are pretty basic and works much like other precious metals or commodities online. You pick an entry position, and if the price moves in your favor, you earn a profit. If it goes against your prediction, you lose.
Silver trading also requires you to understand the basic trading strategies like the fundamental and technical analysis for trading. Without these, you may not win in the market.
Silver trading with online platforms
Online trading platforms are convenient and are a cheaper way to trade silver. Instead of using a third-party broker, online trading platforms allow you to trade on silver prices by yourself. You make all the decisions.
What method you choose depends on how much you know, your available funds for investment, and your long-term or short-term investment goals. Some trading platforms list silver under XAG/USD or SILVER. The online platforms usually let you search for it on their listings and offerings.
When choosing a platform, make sure you read enough about them and ensure they match your needs. Consider the fees, minimum deposits, speed of withdrawal and deposit, and add-on services.
Reasons to try Silver Trading Online
There are various reasons to trade silver. Some are unique to each investor, while others are of a general form.
Trading silver is typically cheaper, more convenient, and flexible. Below are five general reasons why you should try silver trading as an investment opportunity:
A cheaper option than gold
Over the years, silver has statistically proven to be the more affordable option for the global masses. The metal’s low price is why it’s one of the popular investment options and why people find it easier to invest in silver.
According to Trading Economics, silver has remained below $50 over the past 100 years. We’ve even seen prices as low as $13 in 2020. On the other hand, gold has risen steadily from $35 in the 1970s to over $1900 during the pandemic of 2020.
Other commodities like steel, iron ore, lithium, and platinum are pricier than silver. Depending on available funds and preferences, you might find it more accessible and affordable to trade silver than gold or other high-cost commodities.
Resists inflation
Every economy experiences inflation at some point. Some have high inflationary rates, while some encounter low inflation. Whatever level of inflation your economy is on, silver as a global commodity provides a store of value during those times.
You could choose to save all your money in the bank, but when inflation hits, your money loses value, and your purchasing power drops. Silver prices tend to rise whenever there’s inflation, making silver one of the best inflation-resistant ways to store wealth.
However, don’t store all savings with silver trading alone. Consult a financial advisor who will analyze your current financial standing and recommend the best track to save and invest.
Diversify your investment portfolio
The best movie for any investor or trader is to diversify their investment portfolio across multiple channels. Investing is risky, but putting all your eggs into one basket is even more dangerous.
If you spread your risks across multiple commodities, there’s a lesser chance of your investment portfolio turning red. Silver trading provides an easily affordable way to diversify your investment portfolio and mitigate overall investment risks.
Also, portfolio diversity increases your knowledge of the general trading environment. You could find rare wisdom in one investment that could give you profits in another or save you from making a colossal investment mistake.
An additional source of income
For most people, a stable financial life won’t come from one job or business. They’ll have to spread their wings into various ventures to increase their income over time.
Silver trading offers another route for earning and increasing income for such people. Trading silver comes with its peculiarities, needed research, and weeks and months of mastering, but it’s worth a shot.
Silver trading is also an affordable way for income earners in third-world countries to trade and earn outside their economy’s weak fiat currency.
Earn off speculation
Silver prices tend to present a highly volatile price chart. While the price ceiling has stayed below $50 in a hundred years, the heat of the 2020 pandemic saw silver prices going below $15 in April 2020.
Since then, silver has risen to about $28 in august 2020 and March 2021. It is currently titrating between $20 and $22 as of May 2022. Using the understanding of these price charts, traders speculate on future spot prices of silver and earn off the difference through online trades.
While its value hasn’t grown as much as gold in previous years, expert traders know that they can still earn off the price movements of silver. They could adjust their trading strategy to realize profits from the price increases or price drops.
Conclusion
There are numerous commodities with viable investment prospects, including silver. Silver trading is accessible, less expensive than gold, and helps you earn off its volatility through price speculation.
While you consider why you should try silver trading, do your research on the cons of silver trading. Knowing both sides will help you make a more informed investment decision.
