Will Silver Rocket Like Tesla?

Yes, this is a real question. Although some experts would take issue with the phrasing, saying it should read as a statement: “Silver will rocket like Tesla.”

Tesla made headlines for its stock price increase several times over the last year, bringing in a whopping one-year gain of 501%. Silver, however, hasn't made any dramatic moves lately. Sure, it has increased somewhat steadily since the COVID-19 pandemic brought the world to a halt in March; but investors still say its performance has been lackluster, especially compared to its shinier cousin: gold.

Specifically, gold has jumped from $1,473 per ounce in mid-March to $1,950 per ounce today – a 32% increase. During the same timeframe, silver saw a 125% increase from $12 per ounce to $27 per ounce. While a 125% increase certainly sounds better than 32%, silver still hasn’t come close to correcting upwards to its historical silver-to-gold ratio of 30:1. Even after its 125% increase it still lags at 72:1 against gold.

So, if silver hasn’t even performed to its historical standard, what would lead experts to draw any relation between Tesla’s activity and silver’s?

The answer lies in the trajectory – 501%.

When we examine silver’s history, a launch like Tesla’s doesn’t seem far-fetched at all. During its 2008 to 2011 bull market, silver gained 448%. And its 1979 to 1980 bull market? Silver significantly surpassed Tesla’s performance, gaining 722%. It also goes without saying that both of these bull markets happened in response to economic crises similar to the one we face today.

These experts firmly believe everything is in place to see performance like this from silver again, with some even saying silver at $150 per ounce is a “no brainer.”

While there is no way to guarantee that silver will reach this amount, we would confidently say that a significant increase in silver is certainly a “no brainer.”

In the most conservative circles, experts are still agreeing that silver has tremendous pressure for a strong upwards trajectory. To correct to the historical 30:1 silver-to-gold ratio, silver would need to increase 141% from where it stands today, which would be a 442% increase from its low in March. Yet even that projection doesn’t do silver justice, since it is destined to rise proportionately with gold, which is expected to reach $3,000 per ounce.

Whatever your outlook, it's clear that positioning yourself and your clients in silver is the biggest “no brainer” of all. Not only is it set up for tremendous returns, it, like gold, also moves inversely to the markets, functioning as wealth insurance against suffering economies, job markets, and housing markets.

Contact us to learn more about how silver’s historical runs played out in the past and how you could see one in your own portfolio.