Is Gold Better Than Silver or Vice Versa?

Although both silver and gold serve as dual investment vehicles due to their industrial/commercial uses and status as safe-haven assets, silver is used in more industrial products than gold. Silver is often referred to as the 'poor man's gold' because it is significantly less expensive per ounce, making it more affordable for those looking to diversify. Historically, silver outperforms gold by a large margin during longer market cycle upswings, making it a more attractive option for those seeking growth over protection. Furthermore, silver is also considered frontline barter and trade due to its lower value, which makes it more divisible in situations where that may be necessary. It is important to note, however, that while silver can be more volatile on the upside, this is also true for the downside. Gold is typically the least volatile of all asset classes during volatile times. Investors who do not like silver’s volatility and want the added protection gold provides choose all gold or a higher percentage of physical gold in their portfolio.

Unlike silver, physical gold ranks as the third most-held reserve currency in the world, with central banks purchasing massive quantities to hedge against paper fiat currencies like the U.S. dollar. Since the 2008 financial crisis, world tensions, massive money printing, and increasing national debts have significantly heightened, potentially leading to a capitulated death cycle of financial stability in the world’s largest economies. In response, central banks have consistently increased their gold purchases, for 13 consecutive years. Notably, 2020 marked the beginning of substantial year-over-year increases in central banks' gold buying.