What About Silver?

Poor silver. You never seem to hear anything about silver these days as gold is capturing all the headlines. Central banks are buying gold to hedge currency risk. Gold is the pinnacle investment for an inflation hedge as well as a safe haven investment. And lets not forget that gold has broken the psychological $1,000 barrier and keeps hitting record highs. So, what does silver have to say for itself?

There really isn't much to say about silver, except that it is riding on gold's coattails in the precious metals complex. Silver is an attractive investment for investors who like to buy the physical metal by the ounce or silver coins. Some even think silver has more leverage or upside potential than gold.

You can't help but recall that silver went up to $50 an ounce nearly 30 years ago when the Hunt brothers tried to corner the market. Trading around $17.34, silver would appear to have a lot of upside potential when you look at a long-term chart. The only problem is that it is unlikely another dynamic duo will corner the market anytime in the future.

I might be giving the impression that silver is an ugly duckling, but that is not the case. In fact, silver has outperformed gold during the last year. Silver has risen 106% off the October 2008 lows, while gold has only risen 61% from its October 2008 lows. Silver has a long way to go before it hits record highs, but I would expect silver to at least keep pace with gold as long as the rally continues.