Silver (Silver): From commodities to modern investment tools

Over the past two years, the Silver market has been unveiling a new perspective for investors worldwide. No longer just a “junior gold” asset, but a hybrid asset driven by fundamentally different factors from gold altogether. This article will discuss why Silver has become a key topic in today’s investment world.

Why is Silver an asset worth paying attention to?

A Long History as Strong Evidence

More than 4,000 years ago, humans discovered the value of Silver not by chance but because of its unmatched properties.

Archaeological evidence indicates that ancient Egyptians used Silver in the form of rings and bars with standard weights as early as 3000 BC. By the 16th century, Spain began producing Silver coins, which became the first widely accepted currency across all continents.

Although Silver’s role as an official currency ended after 1935 when the world abandoned the silver standard, production of bars and coins for investment has continued to this day.

The Divine Properties Making Silver a Global Asset

What makes Silver irreplaceable is its physical characteristics, which remain important even in the digital age:

• Best natural conductor of electricity and heat, essential in all electronic devices
• High reflectivity, enhancing the efficiency of solar panels in converting sunlight
• Antibacterial properties, widely used in medical applications—from burn dressings to surgical tools
• Flexibility and easy processing, crucial for microelectronics and complex small components

These factors explain why Silver has become an unavoidable component in technological development—from clean energy, electric vehicles, 5G networks, to AI infrastructure.

Current Market Conditions: A Perfect Storm is Brewing

Supply-Demand Imbalance

According to the World Silver Survey 2025, the most reliable industry source, the Silver market is facing a “structural deficit” (Structural Deficit) severely.

Simply put, the world consumes more Silver than can be produced and recycled combined. This situation has persisted for four consecutive years.

Surging demand: The industrial sector hit a new high of 680.5 million ounces in 2024, accounting for nearly 59% of total demand. Specifically, in future technologies—(solar energy, electric vehicles, 5G electronics, and AI)—demand is increasing at nearly double digits annually.

Supply constraints: Meanwhile, supply not only fails to meet demand but faces obstacles such as production issues, reduced by-product from other mining types, and low inventory levels.

This scenario of growing demand meeting stagnant and rigid supply is what analysts call a “Perfect Storm”—a phenomenon that could push Silver prices significantly higher.

Gold vs Silver: A Meaningful Investment Comparison

What Does the Gold/Silver Ratio Indicate?

The tool used to assess Silver’s valuation relative to gold is the Gold/Silver Ratio (GSR), which shows how many ounces of Silver are needed to buy 1 ounce of gold.

During COVID-19 in March 2020, when markets panicked and investors flocked to safe assets, the GSR soared to an all-time high of 124:1. Conversely, as confidence returned and investors sought higher returns with risk-taking, the GSR shrank to 31:1 in 2011.

Currently, the GSR remains high at approximately 84:1 (, indicating that the market has not fully priced in Silver’s industrial fundamentals, leaving room for forward-looking investors to seek opportunities.

) Market Size, Volatility, and Different Roles

The gold market is ten times larger than Silver, valued at about $30 trillion compared to Silver’s approximately $2.7 trillion.

A smaller market size means: when the same amount of capital flows in, it will impact Silver prices much more than gold.

Therefore, Silver prices are 2-3 times more volatile—a double-edged sword. In bear markets, Silver declines more sharply, but in bull markets ###Bull Market(, it surges and does so faster than gold.

Gold and Silver serve different roles: Central banks worldwide hold gold as a reserve asset, but not Silver. This makes Silver a hybrid asset—part precious metal, part industrial commodity—its price more linked to economic cycles but driven by industrial growth factors that gold lacks.

Investment Pathways: Which Channel Suits You?

) 1. Physical Silver Investment: The Traditional Way

Buying tangible Silver bars ###Silver Bars( or coins )Silver Coins( is the most straightforward investment method. In Thailand, several reputable dealers sell these products.

Advantages: Ownership of real assets, no counterparty risk, high privacy.

Disadvantages: Requires significant initial investment, high premiums )Premium(, storage costs, and lower liquidity compared to other channels.

) 2. Mining Funds and Stocks: Indirect Investment

Investing through funds focused on silver mining or buying shares of major producers like Pan American Silver, Wheaton Precious Metals, or Hecla Mining.

Advantages: High liquidity, easy trading on stock exchanges, no storage worries.

Disadvantages: Company-specific risks, such as management issues, high production costs, or geopolitical risks in mining regions. Stock prices may not track Silver prices 100%.

3. Futures Market: For Experienced Investors

Trading futures contracts referencing Silver prices via markets like ###Thailand’s TFEX(.

Advantages: Low capital requirement )Leverage(, profit from both rising and falling markets.

Disadvantages: High risk, complexity, expiration dates, suitable only for professional investors.

) 4. CFD Trading: Flexible and Accessible

Contracts for Difference ###CFD( allow investors to speculate on Silver price movements )XAGUSD( without owning the physical asset.

Advantages:

• Low capital requirement )Leverage(, controlling large contracts with small funds
• Flexible: profit from both long )Long( and short )Short( positions
• Convenient: no storage, insurance, or purity checks needed
• High liquidity: open/close positions instantly at market prices 24/5

Disadvantages:

• High leverage risk
• Counterparty risk )must choose reputable platforms(
• Requires understanding market psychology

Pros and Cons: A Complete View

) Investment Opportunities in Silver

High return potential: Greater volatility and lower valuation compared to gold give Silver a higher percentage return opportunity in bull markets.

Growing industrial demand: Mega-trends like clean energy, electric vehicles, and AI will sustain strong demand for Silver for years to come.

Easy access to prices: Many times cheaper than gold, allowing retail investors to diversify risk with less capital.

Inflation hedge asset: Long history of preserving value ###Store of Value( and protecting wealth from currency devaluation.

) Risks to Consider

High price volatility: The same volatility that can generate huge gains can also cause severe short-term losses. Silver investors must accept higher risks than gold.

Sensitivity to economic conditions: Over half of demand comes from manufacturing; thus, Silver prices are sensitive to global economic slowdowns. Reduced production could pressure prices downward.

Storage costs: For physical Silver holders, costs include secure storage, insurance, and risk of loss.

No passive income: No dividends or interest; returns come solely from price differences.

Summary: Who is Silver Suitable For?

###Silver( has evolved beyond being just an industrial asset. It has become a comprehensive investment tool with clear fundamental drivers.

While gold remains the traditional choice for maximum stability, those willing to accept higher risks and seek higher returns may find Silver’s current fundamentals—its undervaluation relative to gold, supply constraints, and booming industrial demand—an attractive addition to their portfolio.

The key is choosing the investment channel that aligns with your goals, capital capacity, and risk tolerance.