It is only natural when people think of investing in precious metals, their attention turns towards gold as it is the traditional symbol of wealth. However, with the current advances in medicine and technology, silver could end up outperforming gold. Gold's demand comes mostly form jewellery and investing. Silver, on the other hand, is required in a number of different industries.
Green economics are now the future. Silver is required to produce 'green energy', and it is used because of its thermal and electric conductivity properties.
Silver is also used to make the photovoltaic cells that are necessary for solar energy. Thus, demand for solar energy and demand for silver are related.
Cars manufacturers have turned their attention from combustion engineers to photovoltaic engines. Demand for Silver could be affected in three ways if electric cars become the future of means of personal transport in coming years.
1. Silver Vehicle Demand
More silver is used in the systems of electric cars than internal combustion engine vehicles, at times up to 50-100% more. An increase in the demand for electric cars will cause an increase in the demand for silver.
2. Increased Electrical Demand
Solar energy can be used to charge electric cars. An increase in electric cars will result in an increased demand for solar charging, and therefore, silver. Parking lots and garages will be charging stations. The escalation in demand of electrical energy would impact the need for generation of solar energy, hence increased demand of silver.
3. Silver Batteries
Currently electric cars are powered by lithium-ion batteries. This has its drawbacks. They are slow charging, can spontaneously combust, and have a limited range. Solid state batteries are being researched as an alternative. These are better, with quick charging times, long lifespans and longer ranges. The silver-carbon battery developed by Samsung uses silver in it rather than lithium.
If silver becomes the key technology in electric vehicle batteries, or even if silver-containing batteries end up gaining market share, it will further increase the silver demand from the automotive industry.
Those who invest in silver have a high chance of making good gains as silver demand is driven up. The green revolution will be dependent on silver for its performance. Many Analysts think the increase in the silver price would be significantly high for a long period of time.
It is also necessary to note that silver regularly beats gold during bear markets. In the result of the 2008 economic crisis, for example, silver saw its price increase by more than 540%, while gold increased by about a half of that. If you want to invest into silver now, regardless of whether it's to expand your investment portfolio, ensure your risk against inflation or a stock market crash, or benefit from potential future price increases, investing in silver may be the right choice now.
