Did you know that inflation has hit another 40-year high? Even if you don’t follow the news, you can probably feel it. Across the country, Americans are facing higher bills for everyday essentials like gas and food.
With high inflation and a looming recession, it’s normal to feel uncertainty about the future. To hedge against financial turmoil, there are smart investments you can consider. Investing in precious metals can be an easy way to diversify your assets.
Are you thinking about purchasing silver? Keep reading to learn more about the three key financial benefits of investing in silver.
Table of Contents
1. Hedge against Inflation
Precious metals have a long history of purchasing power. Since the price of silver is tied to something physical, its value is not dependent on global markets like the dollar.
Investing in silver allows you to mitigate risks in a number of ways:
- There is no counterparty risk—you aren’t reliant on another party making good on a contract or promise (stocks, bonds, etc.)
- It has never been defaulted on—there is no risk of default because you own physical silver
- It has a long precedent—silver has been used as currency throughout history
- It is a tangible asset—there is no ‘erasing’ or hacking a silver coin like a digital asset
Silver also has a price advantage for the average investor. It is relatively cheap and accessible. To see for yourself, visit investorcrate.com.
2. Diversify Your Portfolio
Portfolio diversification is a key tool for protecting your assets. A smart investor will have a portfolio with a range of assets including stocks and bonds. A strong portfolio will also have non-correlated assets like real estate and precious metals.
Investing in physical silver is a good component of a larger investment strategy. Because of the size of the market, silver has greater volatility than gold.
This means that in bear markets, silver will fall more than gold. On the other hand, in bull markets, silver will soar faster and further. If you are considering a long-term investment strategy, you can expect excellent performance from silver in the next bull market.
3. Benefit from High Demand
Did you know that silver’s biggest use is industrial? A total of 56% of the world’s silver is in products like batteries, electronics, electric vehicles, biocides, and solar panels. In addition, the supply of silver is limited because of industry cuts around mine development and exploration back in 2011.
With the global demand for silver growing, it’s only a matter of time before the price of silver rises to meet the need. Since silver is a highly liquid asset, it’s easy to sell when the market conditions are in your favor.
Financial Benefits of Investing in Silver
Investing in silver can be a smart way to hedge against inflation, diversity your portfolio, and benefit from global markets. When considering your next investment, it’s a great idea to conduct a market review and do the proper research.
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