Most analysts believe that it is more profitable to invest in gold than in silver, since the yellow metal makes sure that its owners have higher profitability compared to the gray one. As a result, investors are favoring gold more.
The yellow metal has been a "safe haven" asset for decades, guaranteeing the protection of capital from the impact of negative political and economic factors. Analysts are confident that these functions of the indicated metal will remain in force. Despite some volatility of the precious metals market, it remains stable and is very popular with investors.
Silver, although not as popular as gold, is also noticed by market participants. Nevertheless, experts recommend having some silver. Experts pay attention to the advantages and disadvantages of owning both metals, which should be taken into account by investors.
Considering the ratio of the value of gold and silver, purchasing silver coins has certain disadvantages in the current condition. Analysts note the following:
- Silver takes up more space than gold. More free space is necessary to store it than purchasing gold for the same amount.
- Experts believe that the price of silver is much more volatile than that of gold. The current high ratio of the cost of both precious metals is in favor of the yellow metal. According to analysts, this fact confirms the high protective properties of gold compared to silver.
- Silver is not usually used as an investment asset in the modern society. Many investors don't see silver as a defensive asset either. As a result, it sells worse and brings less profit than gold.
Gold is at the peak of its popularity these days. Last night, New York Stock Exchange Gold futures closed at their highest level in the past week. Gold futures for February delivery rose 1.3% to $ 1,853 an ounce, while silver futures for March delivery rose 2.5% to $ 24.64 an ounce. Today, gold continues to maintain its gains, trading near $ 1,854 per ounce.
According to experts, the growth of gold's quotes is because of US Congress possible adoption of an additional package of fiscal stimulus. There is a possibility that this will be confirmed before the end of 2020. The next $ 748 billion fiscal stimulus package, proposed by two parties of Congress, includes such support measures as the payment of weekly unemployment benefits and financial assistance to a number of companies.
Economists estimate that the new fiscal stimulus program is very important for the yellow metal. Experts are confident that this will be able to support the precious metal in the short and medium term. At the same time, an increase in the state budget deficit during the program for buying US government bonds contributes to the dollar's further weakening, which is beneficial for gold.
Analysts emphasized that gold remains the winner in the current condition. It is clear that the gold outweighs silver on the scale where both metals are located. Gold has a new stimulus package on its side, while silver does not have that advantage. Moreover, it can be concluded that gold's growth is not hindered even by negative factors such as the reduction in its purchases from exchange-traded funds and the successful introduction of vaccines against COVID-19.
