By Johanna Bennett
Will silver outshine gold in 2017? Prices for both precious metals are down today as stock prices surge and investors continue to rotate out of safe havens following Donald Trump’s victory in the 2016 presidential election, but analysts expect both metals to rally into next year.Price projections for gold run from $1,400 to $1,500 a troy ounce, which calculates out to a 13% to 20% upside. But silver could actually generate better returns, says Maxwell Gold, director of investment strategy for ETF Securities.
He sees the metal rising to $23 an ounce next year, a 30% gain.
Why? Beyond its value as a precious metal, demand for silver, like platinum and palladium, are also tied to industrial production and the economic outlook.
Automobile makers use platinum and palladium automobiles, while silver has a myriad of uses, from solar panels to semiconductors. In fact, industrial uses accounts for half of the metal’s global demand.
“So as the economy bounces back, you will see a boon for these metals,” says Gold.
Piles of money have flowed into the U.S. equities market in the days following the 2016 presidential election as investors raced to position themselves to profit from Trump’s policy stances. As we’ve reported throughout the week, biotech, industrials and financials are popular positions.
In the ETF realm, The SPDR Gold Trust (GLD) and the iShares Silver Trust (SLV) have each fallen almost 5% over the past five days. The VanEck Vectors Gold Miners ETF (GDX) has fallen 12.2%.
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The only drawback for silver and platinum are the premiums are too high... :(
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