What is (Silver) and why is it an investment opportunity that investors should not overlook

Over the past year, Silver (silver) has garnered significant interest in the investment community. People around the world are paying more attention to this precious metal for reasons beyond its traditional role as a safe-haven asset. Today, we will explore what makes Silver valuable and how investors might benefit from it.

Silver Has Played a Role in Human History for 4,000 Years

Before the era of paper money or digital currencies, Silver has served as a medium of exchange and store of value for over 4,000 years. The story of this metal reflects its use across various regions of the United Kingdom since ancient times.

• From 3,000 BCE, archaeological evidence indicates that Silver was used as currency in the form of rings or bars with standard weights.
• In the 16th century, Spain mined Silver to produce coins, which became the world’s first widely accepted currency, boosting global trade.
• Although the official monetary role ended when the Silver standard was abandoned in 1935, Silver continues to be produced in coin and bar form for investment purposes.

Silver Is Gaining New Relevance in the Tech Era

Today, Silver has found a new and increasingly important role. Its unique physical properties make it an essential component for future technologies, even surpassing gold in some aspects.

• Excellent conductor of electricity and heat: Silver has the best electrical and thermal conductivity among all natural elements, making it indispensable in electronic devices.
• Highest reflectivity: This property makes Silver crucial in solar panels, enhancing the efficiency of converting sunlight into electricity.
• Antimicrobial properties: Due to this, Silver is widely used in medical fields, from specialized wound dressings to medical devices and water filtration systems.
• Flexibility and ease of processing: Silver can be easily shaped into small, complex parts for microelectronics.

These factors are key drivers behind Silver’s current price. Whether transitioning to clean energy, developing electric vehicles, expanding 5G networks, or advancing AI, all rely heavily on Silver, making it an unavoidable element.

What Factors Drive Silver Prices

The price of Silver is not random; it is influenced by multiple factors at both macroeconomic (macro) and commodity market levels.

Macroeconomic Factors

• Monetary policy and interest rates: Lower interest rates tend to stimulate investment in precious assets. Changes in central banks’ monetary policies in 2025 have provided significant support for Silver prices.
• Strength of the US dollar: Generally, Silver prices move inversely to the dollar. When the dollar weakens, foreign investors find Silver cheaper, encouraging more buying.
• Inflation and global political uncertainty: Like gold, Silver is viewed as a hedge against inflation and geopolitical risks.

Supply and Demand Factors

The most critical current issue for Silver is the “Structural Deficit” (Structural Deficit), as reported in the World Silver Survey 2025, widely recognized in the industry.

• Surging demand: Industrial demand hit record highs, totaling over 680 million ounces in 2024, accounting for nearly 59% of total demand. The use of Silver in solar energy, electric vehicles, and 5G technology is rapidly increasing.
• Supply cannot keep pace: Silver production cannot meet demand because it is often a byproduct of mining other metals like copper, lead, and zinc. Additionally, the stockpiles of Silver are decreasing.

This situation creates a “Perfect Storm,” now in its fourth year, driven by a persistent structural deficit. Many analysts believe this will lead to significantly higher prices in the future.

Comparing Silver and Gold

When it comes to precious metals, gold is often considered the benchmark. However, understanding the differences between Silver and gold is crucial for making informed investment decisions.

Gold/Silver Ratio (GSR)

The measure of Silver’s value relative to gold is called the “Gold/Silver Ratio,” indicating how many ounces of Silver are needed to buy one ounce of gold.

• During times of extreme fear, such as March 2020 (, many investors flocked to the safest assets, namely gold, causing the GSR to reach 124:1 ), the highest in history(.
• Conversely, when market confidence returns, investors seek higher returns in Silver, causing the ratio to fall. For example, in 2011, it dropped to 31:1 ).
• The current ratio remains high, suggesting the market may still undervalue Silver based on fundamental industrial factors.

( Market Size, Volatility, and Role

• Market: The gold market is valued at approximately $30 trillion, compared to Silver’s roughly $2.7 trillion. The smaller size means that inflows into Silver can have a more pronounced impact on its price.
• Volatility: Due to its smaller market, Silver prices tend to be 2-3 times more volatile than gold, meaning Silver can rise quickly and fall sharply.
• Role: Gold is viewed as a safe-haven asset and official reserve asset for central banks, whereas Silver combines qualities of a precious metal and an industrial commodity. Central banks do not hold Silver as a significant reserve asset.

) Who Should Consider Investing in Silver

For those seeking maximum security, gold remains the standard choice. However, investors willing to accept higher risks for potentially higher returns may find Silver’s prospects very attractive, especially considering its fundamental drivers, lower price ratios, and growing industrial demand.

3 Main Ways to Invest in Silver

Investors interested in Silver have various options, depending on their goals and preferences.

Physical Investment

The most traditional method is purchasing tangible Silver, whether in the form of Silver Bars ###Silver Bars### or Silver Coins (Silver Coins).

• Advantages: Actual ownership, tangible asset, no counterparty risk.
• Disadvantages: Requires a relatively high initial investment, premiums over market price, storage and insurance costs, low liquidity.

( Fund and Mining Stock Investment

Indirect investment through buying units of funds or shares of mining companies.

• Mutual Funds: In Thailand, there are funds focusing on global Silver mining companies.
• Mining Stocks: Investors with access to foreign stock markets can buy shares of reputable Silver producers.
• Advantages: High liquidity, easy trading via stock exchanges, no storage concerns.
• Disadvantages: Management risk, stock prices may not perfectly track Silver prices globally.

) Futures Trading

Suitable for experienced investors familiar with derivatives markets.

• Available in Thailand: TFEX (Thailand Futures Exchange) offers Silver Futures trading.
• Advantages: Low initial capital ###due to leverage###, potential for profit in both rising and falling markets.
• Disadvantages: Very high risk, complex, suitable only for seasoned traders.

Pros and Cons of Investing in Silver

( Opportunities and Advantages

1. High return potential: Increased volatility and a still-low valuation relative to GSR offer opportunities for higher percentage gains.
2. Sustainable industrial demand: The shift toward clean energy and digital economies will sustain Silver’s industrial demand over the long term.
3. Affordable price point: Many times cheaper than gold, making it accessible for retail investors and easier to diversify.
4. Hedge against inflation: Silver has a long history of preserving value.

) Risks and Disadvantages

1. High volatility: While offering high gains, it can also lead to sharp losses in the short term.
2. Economic sensitivity: Over half of demand is industrial; economic slowdowns could pressure prices downward.
3. Physical holding costs: Storage, insurance, and risk of loss for tangible Silver.
4. No income from interest or dividends: Returns depend solely on price appreciation.

Summary

Silver has evolved from a common precious metal into a vital asset for the modern economy. For investors considering adding Silver to their portfolios, understanding their investment goals and risk tolerance is essential.

Regardless of the chosen method, knowledge of the price drivers, supply and demand factors, and comparisons with gold will help you make rational decisions. In today’s market environment, with a continued Structural Deficit, Silver is an asset worth serious consideration for investors.