Friday, April 20, 2012

Go Physical in silver this Akshaya Tritiya

This year Akshaya tritiya falls on 24th of this month.

It is considered a very auspicious day to buy gold, jewelry and the like.

Buying jewelry does not address itself from an investment perspective. Becuase it cannot
be encashed at any point of time. At best you could pawn it.

Why not kill two birds in one shot?

Buy silver in bars!


(1) Traditionally the gold price to silver price ratio is around 16:1. Today it is around 50:1
So silver price should go up within the next one year.

(2) Gold sells for around 1650 dollars an ounce whereas silver can be got at 32 dollars an ounce.
(ounce=31.1 grams). For about just 30,000 rupees you could purchase a 1/2 kg. bar of silver today.

(3) Silver has many uses in the industrial arena like electronics, photography, cell phones, computers, pc boards, medicine (it is even used in certain band-aids) and so apart from being a precious metal, it is also a consumable item.

(4) China which was an exporter of silver is now an importer of the metal. Chinese government is encouraging its citizens to invest in gold and silver coins. US has a silver bullion coin for sale to its citizens. So has China, Australia, Mexico and Austria. But not India. We are crazy in buying silver vessels and silver jewelry.

(5) Let us say you have a lakh of rupees worth of silver vessels and on a rainy day you want to encash it. It would be difficult. Whereas if you had the same in bars/bullion it would be much easier.

(6) Silver which is ruling around Rs. 60,000 a kg. is tipped to go up to around 1,00,000 by the year end, according to Mumbai bullion merchants. Let it go up to 80,000 or even 70,000. Still there is a good return. And there is no downside risk. Silver can never go down to 50,000 by year end!

No comments:

Post a Comment