Gold to silver ratio 2014

[jim4silver]

Whether gold and silver go up or down in price, one interesting play within the PM market itself is the gold to silver ratio. I have heard of people (unfortunately not myself) who sold silver to buy gold near the peak in 2011 (silver to gold ratio roughly 35 to 1), and have recently (since later in 2013) sold that gold to buy silver (silver to gold ratio roughly 60+ to 1). By doing this they were able to increase their total ounces (now in silver) without spending any new $$$$ along the way.

Now with the ratio at 63 to 1, it seems to me silver is still a much better buy than gold, simply going by the ratios. I am not in any way saying this due to the often referred to "historical" ratio of 15 to 1 or so that was government mandated for centuries.

My theory is instead based on a few current factors that cannot be denied. First, the ratio of silver to gold with respect to being pulled from the earth is roughly 9 to 1. This ratio varies a bit from year to year based on mining yields. I have attached a recent article that pertains to LBMA metals transferred and it too seems to show roughly a 9 to 1 ratio for last December.

Further, silver has many more "uses" than gold that make silver more valuable in a practical sense (I am not in any way saying silver will one day cost more than gold per ounce), and it would seem that silver will have increased demand from industry as time goes on and even more uses for silver are thought of in electronics, medicine, etc.

My goal is one day to end up mainly in gold, but I am hoping that the ratio will eventually get back in the 30 to 1 or so range (and maybe even lower), and that will be a good time to sell the silver and buy gold.

Gold News, Gold Market, Mining Companies, Silver News | Kitco News

Just my opinion.

Jim

 

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[DeepseekerADS]

Interesting subject! Last time I remember seeing ratio'd anything like this was back in the Hunt Brothers' fiasco in the early 1980....

Gold went to what, $870/oz, and silver, $48.70/oz? A ratio of about 18:1

Here's an interesting silver chart based on value against the USD..... Note that in today's dollar, it spiked at over $100.00 in value....

 

[Marchas45]

Jim last month I sold 1/10 oz's of gold for 70-1 yep 70-1 Lol I received 35 oz's of silver for (5) 1/10 gold (1/2oz of gold) Keep Stacking

 

[TheCoinKid]

The problem with the current gold/silver price ratio is that it doesn't tell you whether silver is underpriced or if gold is overpriced. Clearly, though, the higher the ratio, the more attractive silver looks.

 

[SilverFace]

The problem with the current gold/silver price ratio is that it doesn't tell you whether silver is underpriced or if gold is overpriced. Clearly, though, the higher the ratio, the more attractive silver looks.

Both metals are drastically underpriced but I agree the high gold/silver ratio as well as the fact that silver prices usually have more short term volatility than gold make silver an even better buy than gold right now. Once pm prices start increasing to historical figures the gold/silver ratio should establish a more reasonable valuation.

 

[Herb Boyd]

As far as mine output is concerned, remember that most major silver mines in South America are privately owned, and in strong financial hands....they pile up production during low prices