Is silver really more worth investing in than gold? Analyzing the 2025 swing opportunities and 5 major trading strategies

First, the conclusion: Silver’s recent rally is indeed fierce, but the volatility is even greater, and the risks are higher.

Since the start of 2025, silver prices have surged to over $65 per ounce, hitting a ten-year high, with an increase of over 120% since the beginning of the year, far surpassing gold’s 60% rise. But what is the logic behind this rally? Can small investors really seize the opportunity? Let’s take a look.

Why is silver rising faster than gold? Three core factors

Explosive industrial demand

This is the key difference between silver and gold. Gold is mainly used for hedging and storage, but silver is different—solar panels, electric vehicles, semiconductors, 5G, AI data centers—all require大量 silver. Especially this year, as green energy transition accelerates, global AI data center expansion has increased silver usage by over 20% annually. From H100 to the latest AI chips packaging, silver consumption has grown about 20% compared to traditional chips.

In other words, silver is not just a safe-haven asset; it is driven by real industrial demand. This provides a fundamental support for its rise, making silver more fundamentally driven than the purely safe-haven gold.

Historical opportunity in the gold-silver ratio

Currently, the gold-silver ratio is about 66:1, while historically it has fluctuated between 50 and 80. When the ratio drops from high levels (above 80), silver often experiences a rebound rally—and this wave is no exception. Silver has risen over 120% from its lows, while gold only increased about 60%, driven by the convergence of the gold-silver ratio.

Interestingly, under the same risk aversion sentiment, the percentage increase of silver is about 1.5 to 2 times that of gold. Simply put, lower base makes silver more prone to explosive gains.

Continued tight supply

The silver market has experienced supply deficits for five consecutive years, with cumulative shortages exceeding 800 million ounces. Slow mineral growth, declining inventories, and several governments listing silver as a critical mineral have further elevated its strategic importance. Tight supply directly supports higher prices.

Silver is really cheaper than gold, but the investment logic is completely different

Many mistakenly think silver is just a cheap version of gold. Not quite:

Fundamental differences between gold and silver

Why do professional investors favor silver?

According to Chicago Mercantile Exchange data, the correlation coefficient between gold and silver prices ranges from 0.4 to 0.8, showing a clear positive correlation. But silver is influenced by more complex factors—both risk sentiment and the health of the tech and industrial sectors. This means more trading opportunities and greater volatility.

A practical figure: gold price is about 30 to 120 times higher than silver. With the same amount of money, you can buy more silver. A 1% increase in silver could mean a 3% rise, and a 1% drop could mean a 3% fall. This high leverage attracts investors seeking amplified returns.

The underlying logic for silver price increase in 2025

Weakening dollar and easing cycle

In Q1 2025, the US will officially cut interest rates, causing the dollar index to weaken. Historically, periods of dollar weakness are often golden for precious metals, and silver is especially sensitive.

Rebound in electronics industry, rigid demand surges

Demand for AI data centers, electric vehicles, and solar panels is exploding, directly boosting silver usage. Unlike gold, which is driven by psychological expectations, silver’s rise is supported by real orders.

Copper prices hit new highs, signaling tight metal supply

Rising copper prices indicate tight supply in the broader commodities market. As a precious metal, silver naturally benefits from this supply tightness.

Currently, silver has surged to $65. Bank of America has set its 2026 target at $65 (average $56), with some institutions more optimistic. But note, after a big rally, a pullback to test support at $60 or $55 is normal.

5 ways to invest in silver—how to choose wisely?

Small investors don’t need to go all-in with large sums. Each method has pros and cons, depending on your risk appetite and capital:

1. Physical silver (coins, bars, jewelry)

Most accessible. Silver bars, coins, jewelry can all benefit from silver appreciation, low entry barrier.

But honestly, if purely for investment, buying physical is not recommended. Reasons: high transaction costs, difficulty in liquidation, poor liquidity. You need to find a silver shop or bank, pay spreads, and frequent trading can eat into profits.

2. Silver certificates

Open an account at a bank, and the bank holds the silver for you. Many banks in Taiwan (Bank of Taiwan, First Trust, Yuanta, etc.) offer this, and you can do dollar-cost averaging.

The downside is similar—high costs, poor liquidity. Suitable for long-term holders who plan to stay passive.

3. Silver stocks/ETFs

Like Pan American Silver (PAAS), Silver ETF (SLV). Low transaction costs, convenient trading hours (can trade during stock market hours).

But leverage is limited; only long positions are possible. Suitable for conservative investors. If you want to swing trade or short, this method is less advantageous.

4. Silver futures

Mainstream leverage instrument. CME’s silver futures (SI) have hundreds of thousands of contracts traded daily, with trading hours up to 23 hours. Both long and short positions can be entered at any time, ideal for short- to medium-term speculators.

Disadvantages: delivery and rollover requirements, need to handle contracts before expiry. Also, silver futures are volatile with high leverage risk. Better suited for experienced futures traders.

5. Silver spot CFD

Margin trading, can go long or short, with higher leverage, no settlement date issues like futures. Many platforms offer stop-loss, take-profit, trailing stops, and other risk controls.

More flexible, especially for short-term traders wanting to amplify returns with small capital. But beware of leverage risks and overnight holding costs.

Best combo for small investors: small CFD with 5x leverage and strict risk control

Practical tips to amplify profits with small capital

Suppose you have only $1,000 but want to catch this wave of silver, you can do:

Step 1: Choose low leverage, set risk controls

Silver is volatile; recommend no more than 5x leverage. Before opening a position, set stop-loss and take-profit orders. Trailing stops are also useful—if the price moves in your favor, they lock in some profits automatically.

Step 2: Observe technical signals and the gold-silver ratio

Use RSI, MACD to identify turning points; also monitor the gold-silver ratio and gold trend. When the ratio exceeds 80, it’s a buying opportunity; below 50, be cautious.

Step 3: Practical example

Suppose silver is at $65, and you expect it to rise to $68. Using CFD, buy 0.1 lot (about 500 ounces), entry at $65, with 5x leverage, requiring about $650 in margin, and set a stop-loss at $63.

When silver hits $68, close the position.

• Without leverage: invest $6,500, profit $1,500, return 23%
• With 5x leverage CFD: invest $650, profit $1,500, return about 130%

But if your judgment is wrong and the price drops to $63, losses will also be magnified. Risk management is crucial.

When is the best time to enter? Capture the golden trading window

For Taiwanese investors, 8 PM to 2 AM Taiwan time is the optimal trading window. During this period, European and American markets overlap, with the highest volume, greatest volatility, and clearest signals.

Entry considerations:

1. Gold trend as a leading indicator—silver often follows gold but with larger swings
2. Watch USD index and interest rates—weak dollar and low rates favor silver
3. Industrial metal prices—rises in copper, oil, etc., usually lift silver
4. Gold-silver ratio opportunities—when the ratio drops from high levels, silver’s rebound begins

Final words

Does silver really have a higher chance of rising than gold? Possibly, but only if you accept the high volatility.

Because of its low price base and diverse uses, silver can indeed experience large short-term swings. But big volatility means both opportunity and risk. Small investors aiming to amplify returns can consider CFD with reasonable leverage, but risk control is essential.

The core logic is simple: It’s not about having more capital to make money, but about making every dollar work effectively.

Remember the gold-silver ratio, pay attention to technical signals, set stop-loss orders, and stay sensitive to market cycles. Even with small capital, you can seize silver’s wave opportunities.