Why are international silver prices soaring? Five investment methods for small investors to seize swing profits

Why has silver outperformed gold so significantly this year? International silver prices have surged over 120%. What is the underlying investment logic? How to choose the right trading tools for yourself? How can small investors smartly allocate limited funds to amplify returns? This article will provide an in-depth analysis.

Silver VS Gold: Why Does Silver Have Greater Potential for Catch-up?

Many investors prefer gold, believing it is more valuable. However, industry experts generally favor silver for three main reasons:

Widespread industrial use with high growth potential

Silver is not only a safe-haven asset but also a critical industrial metal. It is heavily used in solar panels, electric vehicles, semiconductors, 5G, and AI data centers. As green energy transformation accelerates toward 2025 and global AI data center expansion continues, the annual demand for silver is growing at over 20%. From H100 to the latest AI chips, silver usage has increased by about 20% compared to traditional chips, making silver not just a precious metal but also a growth-oriented industrial metal.

Relatively low price, accessible entry point

International silver prices are approximately only 1/30 to 1/120 of gold. With the same amount of capital, you can buy more silver, which is especially friendly to small investors. When market sentiment is bullish, silver’s percentage gains are often 1.5 to 2 times that of gold.

High volatility with clear catch-up effects

Silver’s price fluctuations are much larger than gold’s. During times of heightened risk aversion, silver often exhibits a “catch-up” phenomenon. According to data from the Chicago Mercantile Exchange, the long-term correlation coefficient between silver and gold prices ranges from 0.4 to 0.8, indicating a positive correlation. However, silver is influenced by more complex factors, including risk sentiment, technological industry cycles, and industrial demand changes.

Why Did International Silver Prices Hit a Ten-Year High in 2025?

Market background and price trends

By the end of 2023, silver fluctuated between $22 and $26 per ounce. In the second half of 2024, expectations of US rate cuts increased, global tensions rose, and safe-haven demand grew, gradually boosting silver prices.

In Q1 2025, the US officially entered a rate-cutting cycle. The US dollar weakened, which is usually negative for prices, but the recovery of the electronics industry provided a bullish signal. Demand for silver in solar energy, electric vehicles, and AI data centers surged. Meanwhile, copper prices hit new highs, indicating tight metal supplies, further elevating silver’s value. International silver prices have already broken through $65 per ounce, hitting a ten-year high, with gains exceeding 120% year-to-date, far surpassing gold and most commodities.

Banks like Bank of America set a target price of around $65 for silver in 2026 (average $56), with some market participants expecting even higher. Currently, the gold-silver ratio is about 66:1, still within a reasonable range, and the market is optimistic about further catch-up potential for silver.

Four major drivers supporting price increases

Surging industrial demand

Accelerating green energy transformation and large-scale AI infrastructure expansion continue to expand silver applications in electronics, solar, EVs, and AI data centers, creating rigid demand.

Annual supply shortages

The silver market has experienced supply deficits for five consecutive years, totaling over 800 million ounces. Slow mineral growth and declining inventories provide strong upward momentum for prices.

Gold-silver correlation and catch-up effect

As gold prices rise, the gold-silver ratio quickly converges from 80:1 toward 60:1 or lower. A declining gold-silver ratio is a typical bullish signal for silver. Historically, whenever the ratio drops from high levels (above 80), silver tends to rally significantly. Under similar risk sentiment, silver’s gains are about 1.5 to 2 times those of gold. In this wave, silver has risen over 120% from its early-year lows, while gold has gained about 60%.

Rising safe-haven demand

Global economic uncertainties are increasing, prompting investors to flock into precious metals for protection. Several governments have included silver on critical mineral lists. Its safe-haven attribute has shifted from inflation hedge to “geopolitical supply chain hedge,” attracting more institutional buying.

Five Ways to Invest in Silver: A Detailed Comparison

Want to invest in silver but unsure how to choose? The following five options cover risk levels from low to high:

1. Physical silver (jewelry, silver bars, silver coins)

Physical silver, similar to gold, is the most familiar investment channel for the public. Silver jewelry, bars, and commemorative coins can all benefit from silver appreciation. The advantages are tangible feel and relatively low entry barriers.

However, physical silver has notable drawbacks: high transaction costs (wide spreads), difficulty in liquidation, and poor liquidity. Therefore, if the goal is investment, physical silver is not recommended due to high transaction costs and low liquidity.

2. Silver certificates

Many banks offer silver certificate accounts, allowing easy purchase—buy at the bank, which then safekeeps the silver. Several banks in Taiwan support this service.

Note that silver certificates are investment products, not deposits, and do not accrue interest. While certificates can be used for regular, fixed-amount trading, high transaction costs make them suitable mainly for long-term investors.

3. Silver stocks and ETFs

For stock investors, related concept stocks and ETFs are convenient ways to access the silver market. Compared to physical silver, these investments have lower trading costs and more flexible trading hours.

However, ETFs and stocks have limited leverage and only allow long positions, making them more suitable for investors seeking stable allocations.

4. Silver futures

Silver futures are mainstream leveraged trading instruments. The CME’s silver futures (SI) are among the most active contracts globally, with daily trading volumes reaching hundreds of thousands of lots. Trading hours extend up to 23 hours a day, almost around the clock, allowing short-term and medium-term traders to enter and exit at any time.

However, futures involve delivery and rollover mechanisms; positions must be closed or rolled over before expiry, which adds complexity. Silver futures are more suitable for investors with medium- to short-term trading experience.

5. Silver CFDs

Silver CFDs operate similarly to futures—they use margin and leverage, and can be long or short. Advantages include more flexible leverage, no settlement or rollover issues, and platforms often provide risk management tools like stop-loss, take-profit, and trailing stops.

The downside is overnight holding costs and less liquidity compared to futures. CFDs are better suited for short-term traders who can handle high leverage risks.

How to Amplify Profits with Limited Capital?

If your funds are limited but you want to seize silver’s short-term opportunities, consider these strategies:

Small amount + moderate leverage

Choose platforms supporting low leverage trading, ideally no more than 5x. This can amplify gains while effectively controlling risks.

Implement robust risk management

No matter which method you choose, set stop-loss, take-profit, and trailing stop parameters. This is key for small investors to survive.

Combine technical and fundamental analysis

Observe the gold-silver ratio, gold trends, USD index, interest rate policies, and industrial metal prices, and use technical indicators like RSI and MACD to identify turning points.

Trading example

Suppose the international silver price is $65.00/oz. You open a long position of 0.1 lot (500 ounces) with 1:100 leverage, setting a stop-loss at $63.00.

A few days later, silver rises to $68.00. You decide to close for profit. Comparing the results:

Note: Transaction costs are not included; high leverage also amplifies potential losses.

When is the best time to enter?

The timing of silver trading mainly depends on personal experience and risk appetite.

Optimal trading hours

In GMT+8 Asia timezone, Taipei time 8 PM to 2 AM (overlap of European and American markets) is the most suitable trading window. Market volatility is highest, signals are clearer, and volume is ample—ideal for short-term trading.

Direction judgment tips

Silver and gold tend to move in the same direction, but silver’s safe-haven attribute is weaker. Consider these methods:

• Follow gold trends: The gold-silver ratio tends to move in tandem, with gold often leading.
• Combine fundamental analysis: USD index, interest rates, and industrial metal prices influence silver.
• Use technical indicators: RSI, MACD help identify reversals.
• Monitor the gold-silver ratio: Historically fluctuates between 50 and 80. When it exceeds 100, silver is relatively undervalued, offering a better entry point.
• Adjust flexibly: Market shifts can turn silver from a safe-haven asset into a risk asset, so strategies should adapt accordingly.

Conclusion: Is silver really more likely to rise than gold?

The answer is: possibly, but with greater volatility.

International silver prices, due to low base, diverse uses, and market sentiment, often experience sharp short-term fluctuations. If you can master entry timing and choose suitable trading tools, even small investors can amplify returns.

The key is not how much capital you have but how to make every dollar work hardest. The path of silver investment is open—finding the approach that best suits you is the most important.