“Silver is now more attractive than it has been in decades,” my colleague Porter Stansberry wrote to his subscribers.
“Assuming gold hits my target of $2,000 an ounce and assuming the price of gold is 16 times the price of silver,” Porter continued, “then silver should be worth about $125 by the time the bull market in silver reaches its peak.”
If Porter is even half right, then a recently launched silver investment could be the safest way to make over 1,000% in silver.
You see, before this year, we didn’t have a simple way to buy a basket of silver companies. But now we do…
The Global X Silver Miners Fund (SIL).
This exchange traded fund owns a basket of the world’s purest plays on silver mining – 30 stocks in all, with decent geographic diversification. (Silver companies from Canada and Mexico each make up a larger percentage of the fund than U.S. silver companies.)[ad#Google Adsense]If you think gold mining companies are speculative – you ain’t seen nuthin’. Silver mining companies are extremely volatile. To see what I mean, take a look at the performance of the underlying index of the Global X Silver Miners Fund, versus the price of silver.
In 2008, when the price of silver fell in half, shares of silver mining companies lost 80% of their value.
Since bottoming in 2008, silver mining companies are up FOURFOLD, as you can see in the chart. Silver is up about 250%.
Shares of silver companies are significantly more volatile than the price of silver. If Porter is right about the price of silver rising 500%, silver mining companies could easily soar over 1,000%.
Right now, you have four basic ways to profit if the price of silver goes up…
You can buy bags of silver coins from a dealer… but to build a serious position, you’d end up with a garage full of silver.
You can buy shares of the iShares Silver Trust (SLV), which tracks the price of silver. (For leverage to the silver price, you could buy double-long and double-short silver funds from ProShares.)
You can buy shares of a handful of silver companies.
For maximum upside, with more diversification than owning just a couple silver stocks, you can buy the Global X Silver Miners Fund (SIL), which holds shares of 25 silver companies. It’s a volatile basket. But if silver rises like Porter thinks, you could make 1,000%-plus here.
As Porter told his readers, “However you decide to own it, make sure you buy some silver now.”
— Steve Sjuggerud[ad#jack p.s.]
Source: Daily Wealth