Silver Surges 2.9%; It’s Just the Beginning

By Roger Baettig | August 27 2012 11:22 AM

The window for investing in silver while it's still cheap is quickly disappearing. Last week showed signs of increased investor support and Europe easing as the euro rose against the dollar at over a 1% gain. Just a few weeks ago, silver was at a cheap and humble $26/oz. and now it soared to over $30/oz. If the support for precious silver continues as it's expected to, there could be a fast and quick catch-up to gold, closing the value ratio and likely hitting $50/oz before year's end.

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Economist Shayne Heffernan of www.livetradingnews.com Market Outlook.

Stephen M Smith who is the managing member of Smith McKenna believes that this initial breakout in the silver price is just the beginning. Last year the surge in precious metal prices was cut short due to natural disasters and other factors that hindered the economic growth outlook, however this year there appears to be no signs of them slowing down once they take off.

The European Central Bank has a policy meeting coming in September which could be a strong factor in the price of precious metals, especially with inflation on a lot of investor's minds. Gold could easily reach $1,700/oz which would again be another factor to put silver in a spot to play a steadfast game of catch-up.

Investors purchase physical bullion as a strategy against inflation because it's a physical asset with real value versus owning a piece of paper. Physical silver is used as an industrial metal and as an investment vehicle because of its exceptional properties tied to the precious metal market and global manufacturing. A sharp increase in both areas could mean never before seen highs for silver.

Many investors became very wealthy by 2011 when precious metals were exploding. Gold was in the spotlight then, but now investors are quickly learning that silver could be crowned king; especially if its expected surge in value of more than three times to that of gold occurs. Last week's initial breakout is likely a sign of future trends and what's in store for the precious metals market. Keep a close and watchful eye on the white metal as it's likely the ideal time to increase silver investments and for first time investors to learn how to approach the market.

Shayne Heffernan

Shayne Heffernan oversees the management of funds for institutions and high net worth individuals.

Shayne Heffernan holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reached a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.Read the Terms of Service