Gold Versus Silver - Which Is the Wisest Investment?

One of the most common questions we get from clients is whether they should buy either gold OR silver. Anyone researching an investment in bullion can find good arguments for owning either metal.

One of the best ways to evaluate the prospects of one metal versus the other is by looking at the gold/silver ratio.

Gold and silver prices tend to move in the same direction on any given day, with silver being the more price-volatile of the two. Over time, though, they can diverge.

This ratio has generally moved higher since May 2011. At that time, silver had reached nearly $50/oz and the ratio bottomed at just under 40:1. The ratio topped out in 2020 at almost 120. Today it stands at about 78.

While the ratio has fallen, it remains well above some historical benchmarks. The average over the past three decades is about 60, but over the last 80 years, it's under 40.

The "natural ratio" for silver is estimated at 10. That's the proportion of silver in the Earth's crust relative to gold.