What is The Best Way to Invest in Silver?


Most investors turn toward precious metals like gold and silver to diversify their portfolios. Silver is a relatively stable investment instrument that has historically increased in value. After gold, it’s the most popular precious metal for investing and hedging against inflation.

Let’s learn more about the different ways of investing in silver.

Silver coins and bullion

Investing in physical silver through coins and bullion is popular among many people. There are both pros and cons to this approach. On the good side, you get to physically store your silver and buy/sell whenever you want. On the downside, you typically end up paying more than the spot price of silver when buying silver bullion and coins. Moreover, you will not get a fair exchange value if you have to sell your silver on short notice.

Storing large amounts of silver also comes with the risk of theft. Nonetheless, it’s arguably the most popular way of investing in silver.

Silver futures

Investing in silver futures isn’t as straightforward as investing in silver coins or bullion. On the positive side, silver futures give you the opportunity to earn amazing returns if it goes in the right direction. Similarly, it’s easy to lose a lot of money if your silver futures don’t move in the right direction. Investing in silver futures gives the option of taking physical delivery of the silver, but that’s hardly the primary motivation for investors.

Silver futures are riskier than other forms of investing in silver. However, if you are seasoned in future contracts, it can earn you amazing returns.

Silver ETFs

Silver ETFs are the investment instrument of choice for investors who don’t want to take high risks. A physical silver-owning ETF will provide a return equal to silver prices after deducting the ETF’s expense ratio. The only downside here is that you never get physical possession of the silver. Everything else works in the favor of the investor:

  • ETFs provide instant liquidity at a fair price
  • ETFs charge low expense ratios
  • You can invest small amounts of money
  • There’s no risk of theft or laundering

Considering these benefits, most silver investors go for silver ETFs, though they may supplement it with other instruments.

Investing in silver mining companies

An indirect way of investing in silver is to invest in companies that benefit from the rising price of silver. You can directly buy stocks of silver mining companies just as you would buy any other stock.

However, the general risk of investing in stocks applies here as well. If you want to diversify your portfolio, buying more stocks may not be a good option. Moreover, a company’s stock can fall for several reasons, some of which may have nothing to do with the price of silver.


Investing in silver has many benefits like steady growth, hedge against inflation, and low volatility. Choose your preferred mode of investing in silver based on your risk-taking appetite, financial capacity, and investment horizon.

Tags: Precious metal for investing