If soaring gold prices makes you feel good and you are thinking of cashing in on this trend in 2010, then read this article to know about another investment that can rocket faster than gold in 2010 and give you 3 times more ROI as compared to gold.
Investing in gold right now can be a good decision but this other investment that also luckily happens to be a metal can be three times more profitable. Guess the name of this metal! Yes, silver, you are right!
What’s so special about gold and silver. Gold has been ingrained in the human psychy as the thing of beauty as the ultimate wealth. Throughout human history, people have been hoarding gold. The same phenomenon has not taken hold of different countries. Dollar has become weak due to the recent financial crisis that the world experienced. Countries like China, Russia and India want to hedge their international currency reserves most of them being in US Dollar. So, they want the ultimate currency, “gold.” This way these countries think they would be safe in case of a major Dollar devaluation that might take place in the unforseen future. Silver is also being bought as both gold and silver have been used to mint coins from times immemorial. This trend of buying huge quantities of gold and silver is driving their prices sky high. Remember the time in 19th century when the world was on the gold standard. Countries would keep gold and silver as international reserves. We might be headed back to that time!You never know. No one knows the future. No one could predict the birth of the present currency markets that took place in 1973. No one knows the future of currency markets! Now, gold and silver respond to almost the same fundamentals. When gold prices go up, silver prices will invariably follow.
Silver or the while metal is experiencing many other forces that can force the prices of this white metal to rocket even faster than gold even beyond those driving megatrends the while metal shares with gold.
Silver is widely used in coin minting, electronics, photography, plastics, soldering (joining two metal pipes), computers particularly notebooks and laptops, refregerators and even dishwashers. So, as you can see, the demand for silver is on a much higher level as compared to gold. Without silver, many industries will come to a grinding halt!
What this shows is the supply of silver is even more limited as compared to gold. The best way to profit from investing in this gold and silver rush that is going to happen in 2010 and beyond is to purchase gold and silver calls or trade gold and silver futures.
Now, if you have never traded futures contracts, you might think about learning how to trade futures contracts especially gold and silver futures contracts. This way, you can profit from the volatility in the gold and silver markets. Futures trading is risky no doubt but for those who don’t want to get good training before they start trading futures. What you need is to open a practice account and start paper trading gold and silver futures. This way, you will be in position when the great gold and silver rush starts again1
Now, as I have said earlier, you can also invest in gold and silver mining companies by buying their stocks. This is exactly what many people did in early 1970s when the last boom in the gold and silver markets took place. Many became rich in a few years. The same gold and silver boom is coming in this decade that started a few days back.
In 1970s, silver went from $1.29 in 1970 to it’s zenith $49.45 in 1980. This was a percentage gain of 3,733%, something astounding! Many of you might be thinking that 1970s is a great story but now distant memory and just a daydream now. The wealth building power of gold and silver might be beyond us.
Now, I give you the example of Lion Mines. You could purchase it’s share for jut 7 cents in 1976. By early 1980s, it was worth a staggering $380 per share. By just purchasing $184 worth of it’s stocks in 1976, you could have easily made a million in just under four and a half years. History is going to repeat again with silver in the new decade!