Do you want to get into silver trading? Great! This comprehensive guide will answer all your questions, and help you trade Silver today. Let’s start with the most fundamental question.
What is silver trading?
Silver trading is speculating about the price movements that result from buying and selling Silver bullion in the open markets. To profit from price fluctuations, traders usually place positions based upon their expectations for Silver’s future prices.
A Silver bullion refers to a coin or bar made entirely from Silver.
Contrary to traditional Silver investing which requires you to buy and hold Silver coins and bars, contemporary Silver trading allows for exposure to the market price and without actually owning any metal.
Types of silver trading instruments
Trading Silver assets can be done using a variety of trading instruments, including futures, spot prices and shares.
Each instrument has its own benefits, potential risks and unique advantages. These 4 instruments allow traders to profit from falling and rising Silver prices.
The principle behind it is that the more the market moves in a trader’s expected direction, then the higher their profit will be. Conversely, the further it moves against them the greater their loss.
Did you know?
Due to its use as a precious metal in jewelry, electronics and tableware, silver is the second most traded precious metal asset. Investors also value silver as an inexpensive asset.
To multiply your profits, open an account today and trade Silver !
Is there a relationship between Silver and Gold? Is there a silver-gold ratio?
The Gold-Silver ratio is the amount of Silver required to purchase one ounce Gold at a given spot rate. This ratio determines how the precious metals at any given moment are compared. A ratio of 55 would indicate that more than 55 Silver ounces are required to make an ounce of Gold.
During bear markets, the ratio of Silver-Gold is higher than it is during bull markets. It falls during bull markets. Because Gold is more sought after than Silver in economic downturns (although both are safe havens), it becomes more expensive. Once the economy is back on its feet, Gold’s value drops and it trades more closely to Silver.
Although historically, Silver has been more valuable than Gold, this relationship has not been established. While similar factors can influence the price of each metal, this doesn’t necessarily mean that their prices are in direct correlation. If the Gold-Silver ratio was below 1, silver would be the most valuable precious metal.
What factors influence the silver price?
Supply and demand determine the price of silver. Prices will rise if there is more demand than the available silver, and fall if there is less supply. Because Silver prices are more volatile than other metals, it is important to understand the factors that influence them.
Insecurity in politics and economics. Silver can be regarded as a safe-haven when markets are in turmoil. Both precious metals can be trusted to hold their value even when other asset classes fall. As inflation rates rise, silver is seen as a safe haven for wealth.
Industrial Features. Silver is highly conductive, antibacterial and malleable. This contributes to its steady demand. Silver’s use isn’t affected by economic downturn – Silver can be used for water purification, batteries, and dentistry, regardless of economic circumstances.
Silver can be denominated using US dollars. Like most commodities. Investors can find Silver more or less costly depending on fluctuations in the price of the greenback. As it becomes more costly to buy in other currencies, silver’s demand will decrease.
Mining of other metals:Silver can be found mixed with arsenic and sulfur to make it more common. Any increase in copper or lead demand could result in an increase in Silver supply.
How to start silver trading
You can open a trading account on a trusted platform such as ISA Bullion.
Start trading Silver by depositing your funds
You are the first to take over.
Analyze your trades with both fundamental and technical analysis
You can trade futures or spot prices to get exposure to Silver. This is a better option than purchasing the metal directly. You can trade spot and futures prices to get exposure to Silver. This is an alternative to buying the physical metal.
Trade silver on the spot
Spot prices for Silver allow you to trade at the exact moment or ‘on-the spot’ the current Silver price.
Spot market is the most popular way to purchase and sell Silver. Spot price is the current value of an asset such as a commodity, currency, or stock.
Spot market trading means that you buy or sell at the current price, and not make payments or receive funds in advance.
The difference between selling and buying on the spot is known as the ‘bid/offer Spread’. This refers to the amount a trader pays to place an order. If you were to purchase one ounce at $16 an ounce, your total cost would be $1×16 = $16. Your total cost to sell 1 ounce of silver at $16 an ounce would be $16 x 1, $16 = $16.
If you have the right platform and know how to invest in Silver and Gold, trading silver can be very lucrative. ISA Bullion allows clients to trade physical Gold and silver bullion regardless of where they may be located.
Start with a minimum deposit to build your portfolio and then grow it at your own pace. Download the ISA Bullion App and access our platform from your computer.