Silver catches up and rises to €770 per kilo

Silver has made an unprecedented catch-up to gold in recent weeks. In just three weeks, the price of silver rose by more than 40% to €770 per kilogram. This puts the price at its highest level since the end of 2012. This week, the price has been even higher, because in the night of 6 to 7 August, silver was just above €800 per kilo.

As a result of this spectacular price increase, silver has now overtaken gold as the best-performing precious metal. At the depths of the corona crisis, silver fell sharply along with share prices, while gold managed to limit its losses. After that, the Silver price Back to pre-Covid levels, to break through the important resistance level of $20 per troy ounce in July. From that moment on, the silver price only started to rise faster.

Silver price skyrockets

All technical resistance levels were breached, after which the price rose by tens of percent in a few weeks. In mid-July, there was still a silver price of €540 per kilo on the boards, at the time of writing it is €770 per kilo. In dollars, the price rose from $19.50 to more than $28 per troy ounce in the same period.

The chart below shows the price movements of gold, silver and the S&P 500 since the beginning of this year. We see that gold initially came through the crisis much better, with which the precious metal lived up to its status as a safe haven. Silver proved to be no protection against the panic in the financial markets, as the price fell as much as the S&P 500 index in February and March.

Silver catches up (click for larger version)

Gold vs Silver

The fact that silver is more speculative and volatile than gold also offers opportunities for investors. Since the beginning of this year, the precious metal is already up 55%. In fact, from its low point in March, the price has more than doubled. At one point, silver was dumped on the market for €350 per kilo. For investors who are willing to take on more risk and are not afraid of volatility, silver has been particularly lucrative this year.

The corona crisis has caused a flight to precious metals this year. In addition, gold was able to distinguish itself as a safe choice due to the minimal price drop risk, while Investing in silver is interesting for the more speculative investor due to the large price fluctuations. Both precious metals have delivered very good returns this year, especially when compared to the stock market.

This contribution was made from Geotrendlines