Gold Silver Ratio at 100: Don't Miss This Chance to Buy Silver
In the past week, the Gold-Silver Ratio (GSR) has climbed above 100, the second-highest ever recorded in history. It was only eclipsed by the ratio’s record high of 125 registered in 2020 during the COVID-19 crisis.
One of the most-visited webpages on our website is our long-term Gold-to-Silver Ratio chart. We plotted the chart using gold and silver price data since 1970, a year before President Nixon severed the link of the U.S. dollar to gold.
The GSR is obtained by dividing the gold price by the price of silver. So if the gold price is SGD 4,200/oz and the silver price is SGD 42/oz, then the ratio is 100.
Our observation of the ratio’s fluctuation over the past decades led to our ‘80-50 rule’, which we have shared with our clients over the years. Following this simple rule increases one’s precious metals holdings over time, switching between gold and silver based on the overvaluation or undervaluation of one metal over the other.
Here is how the 80-50 rule works: When the GSR is above 80, silver is undervalued compared to gold since the value of 1 oz of gold is equivalent to 80 oz of silver. Time to buy silver!
Conversely, a ratio below 50 signals that gold is undervalued versus silver. The last time the ratio went under 50 was during the run-up to the peak of the last precious metals bull market in 2011, during which silver rose from USD 20 to USD 49 in about eight months.
We believe a repeat of this behavior in the silver price will happen when the current precious metals bull market enters its final phases in the near future. Gold is already making headlines with its repeating new record high prices.
Take advantage of the high GSR by buying silver!
Click image to view our long-term Gold Silver Ratio chart
If you own gold, you can consider selling some gold at its current high price to buy silver since it is so undervalued.
Alternatively, if you bought gold for long-term wealth preservation, you can borrow against your gold on our Bullion Secured Loan Program to avoid selling it. This allows you to unlock potential funds for reinvestment in silver using gold that is otherwise unutilized in storage.
Lenders and borrowers on our Loan Program are clients with verified S.T.A.R. Accounts. They can list their lending offers or borrowing requests on our website according to their preferred terms (e.g., loan principal, tenure and interest rate).
You can easily convert your retail Silver Bullion account to a S.T.A.R. Account online and transfer gold into our vault for storage to begin participating as a borrower. Please contact us or visit our Millenia Walk retail store should you need assistance.