Being considerably more useful than gold, silver is everywhere and used in nearly every major industry, from medical applications for its anti-microbial properties. To the ever rising tech space like 5G, batteries, solar panels and electric vehicles. This industrial use is only growing each year while silver inventories have been diminishing since 1996. Currently around 50% of Silvers total demand comes from industrial applications, while 30% comes from jewelry, silverware and coins.
The Gold to Silver Ratio
Also known as the mint ratio, it is the quantity of silver in ounces needed to buy a single ounce of gold. The ratio in December 2021 was 77:1 implying that the silver price is massively undervalued. Many analysts believe silver should be trading at five times the amount it’s trading at the moment.
"The very fact that the gold-silver ratio is at roughly 80:1, that alone suggests that if gold is going to rise, silver at the very least is going to come along for the ride and could quite likely outperform gold"
Retail and Wall Street Investor Interest
After a disappointing year for gold and silver, Wall Street is looking for the tide to turn in 2022 and points to silver and platinum. According to Ole Hanson, head of Commodity Strategy at Saxo Bank, although around 50% of the demand for silver was industrial, the rest came from investors. In 2021 demand for physical silver investment jumped 32% and hit a 6-year high, this trend is likely to continue into 2022.