Silver

Over the last few years, silver has emerged as a magnet for investors seeking a safe haven asset, alongside gold. Although by far not as valuable as gold, silver is a very special metal in its own way. It too exhibits some outstanding physical and chemical characteristics, which make it indispensable in high-tech devices. It even possesses some anti-microbial “powers”.

Another interesting twist concerning silver is that while it is indeed much more abundant than gold, it is much less abundant as a native metal.

Silver has also been used for jewelry and as a store of wealth since ancient times. Its mining apparently began some 5,000 years ago, in what is modern day Turkey.

Silver’s chemical symbol is Ag and its ticker symbols are SI and ZI – depending on the exchange where it is traded.

Investors are naturally interested in the factors that drive the price of silver.

– of these, the price of USD takes up a top spot. As with most top commodities such as gold, with silver, the USD is inversely correlated. As the price of silver goes down, USD gains strength. As the USD weakens, the price of silver tends to go up. In this regard, it is safe to say that silver mimics the way gold correlates with the greenback.

– beyond its correlation with USD, silver is also correlated with gold. This correlation is a direct one however: silver tends to follow the price of gold.

-demand is obviously a major price-driving factor as well. Given the varied and diverse uses of silver, there are a high number of industries that need it, above and beyond jewelers.

Chip makers, coin mints, silverware production and photography all rely on the metal.

– Interest rates and inflation apparently have an effect on silver prices as well. There is no clear definition of this impact however. It makes a certain degree of sense for investors to make use of silver’s safe haven nature in case of runaway inflation.

– various government policies and actions also have an impact on the price of silver and commodities in general.

Silver production

While some silver is found in its native form in the earth, it is in fact less abundant in this form than gold. Most of it comes from gold, copper, lead and zinc smelting, as a byproduct. Thus, overall, it is much more abundant than gold.

Abundance-wise, silver is about the equivalent of mercury. As mentioned, most of the silver comes from copper, gold, zinc and lead production. Ore rich in this precious by product is mined in some South American countries, such as Chile, Bolivia and Peru.

Australia, Poland and Serbia are also major silver producers. Tajikistan is thought to have perhaps the largest silver deposits in the world.

In 2014, some 26,800 tons of silver were produced world over. Mexico led the way with a staggering 5,000 tons, followed by China, with a little over 4,000 tons and Peru, with 3,780 tons.