Sprott on Silver

“Silver, in particular, has the potential to outperform gold significantly. For example, in the wake of the global financial crisis, the gold-to-silver ratio plummeted from 80:1 bottoming at 32:1, with the silver price topping out at ~$50/ounce. Recently the ratio hit a record 93:1, while the price is sitting at around $16/ounce. Yesterday, the ratio stood at 89:1 as shown in Figure 2.

This leaves significant room for silver to run. The annual silver market is only about $15 billion of value, and it does not take much to move silver’s price. Silver demand is already making a stealth comeback with the U.S. mint reporting a 43% increase in silver coin sales year-to-date as of June 30 and with ETFs gathering steam. If this investor interest continues, it will definitely push the silver price higher. (Sprott)

Sprott has always been bullish on precious metals and Eric Sprott himself has been instrumental in funding a wide variety of gold and silver plays. It is interesting that Sprott media sees silver as outperforming gold in the mid-term.



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