As inflation fears continue to mount, more attention is being focused on the precious metals industry. Silver has been doing better than gold in recent years, considering the metal’s dual use as both a precious and industrial metal
These recent months of elevated and increasing prices exacerbated by price plunges due to the COVID-19 pandemic saw inflation reaching 3.8%, its highest in 30 years.
Meanwhile, silver remains relatively cheap compared to the S&P 500 ratio.
It currently sits near its 50-year lows. That means silver prices would have to rise by a factor of 63 times just to match their level at the $50 peak in 1980. While this might sound sensational, such conditions have existed in the past.
Protection from inflation and uncertainty is a good reason to buy and own silver. Given the rising economic uncertainty, many investors are hedging against the risk by turning to bullion or silver stocks.
And it seems now is a good time to look into the best silver stocks on the market. In the past 15 months, prices for physical silver are higher than normal. As demand for physical products remains elevated this leads to sustained high premiums over the spot price. And that's if you can even get your hands on them. Many of the most popular coins and bars are persistently out of stock. Premiums are typically 40% or higher, which is nearly triple normal levels.
Furthermore, in its recent World Silver Survey 2021, the Silver Institute is forecasting continued strength this year. Physical demand is expected to climb by 26% after a very strong 2020. Overall demand, from all sectors, is likely to go up by 15%, nearly doubling supply growth of 8%.
When looking at silver stocks and silver prices, we have to mention flexible electronics. The Silver Institute indicates demand for silver in printed and flexible electronics is about 48 million ounces annually.
Another indicator that now may be a great time to be bullish on silver is its seasonal trend.
Analysts view a basket of silver stocks or mining stocks of silver mid-tier and junior miners as a great way to approach the high potential of this sector right now. Silvercorp Metals Inc. (NYSE: SVM), Endeavour Silver Corp. (NYSE: EXK), Fortuna Silver Mines Inc. (NYSE: FSM), First Majestic Silver Corp. (NYSE: AG), and Hecla Mining Company (NYSE: HL) are the best silver mining stocks to invest in right now. These stocks have been selected based on hedge fund sentiment, fundamentals, analysts’ ratings, and growth potential based on core business strengths.