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Silver investing has yielded generous returns this year compared to investing in other precious metals.
As of 11:30 a.m., silver prices today (Friday, Feb. 24) trade at $18.35 and have seen a 2017 return of 14.8%. That outpaces the gold price gain of 9.2% and platinum price gain of 13.6% over the same period. Even more important is how the price of silver has nearly tripled the Dow Jones Industrial Average’s year-to-date gain of 5%.
In fact, the Dow Jones’ insane rally over the last two weeks is typically bearish news for silver prices. But Money Morning Resource Specialist Peter Krauth believes the price of silver will gain 19.9% by the end of the year – and that’s being conservative.
Here’s why the climbing Dow Jones failed to stop the silver price rally this week…
Why This Bearish Silver Investing News Didn’t Hurt Prices This Week
Despite being down 0.3% as of midday today, the Dow Jones has been on its longest winning streak in three decades.
From Feb. 9 to Feb. 23, the index has closed at a new all-time high every single day. It has climbed 3.8% over that period to its most recent settlement of 20,809.91. The Dow Jones rally started on Thursday, Feb. 9, after Trump teased that his tax cut plans would be implemented sometime this year.
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A soaring stock market is usually bad news for silver investors. When stock prices keep going higher and higher, investors think there’s no way they can lose money. That urges them to withdraw their money from safe havens like silver and put it into stocks. After all, safe-haven investments are most attractive during times of stock market volatility.
But the 1.4% jump in silver prices this week shows there’s still plenty of demand for the metal. And Krauth – a silver and gold expert whose work in the resource market spans over 20 years – says demand for physical silver will stay strong this year thanks to an emerging trend in the silver industry…
This Source of Silver Demand Will Push Prices 19.9% Higher in 2017
Silver is an essential component of many industrial devices that we can’t live without. That means its role in these devices will be a consistent boon for long-term silver prices.
The physical properties of silver give the metal a crucial role in many technology and medical applications. It’s used in GPS receivers, computers, nuclear reactors, solar panels, batteries, dental equipment, semiconductors, and many more devices.
But the biggest source of silver demand is by far the solar market…
You see, solar panels use photovoltaic (PV) cells made of silver to harness energy from the sun. Since about two-thirds of an ounce of silver is used in one solar panel, silver demand will rise alongside demand for solar panels. Energy research firm GTM Research reports roughly 410 megawatts of community solar panels will be installed in 2017. That’s up 88.1% from 218 megawatts worth of panels in 2016.
The booming solar industry – combined with consistent demand from devices essential to our livelihood – ensures silver demand will strengthen in 2017 and beyond.
“There is growth right now across the board in these industries – strong growth – that’s only going to get stronger in the new year,” Krauth said on Jan. 12. “I can’t imagine demand would slacken under these circumstances.”
Krauth says silver prices will reach $19 an ounce by the end of next month. He also believes they will hit $22 by the end of the year. That would be a 19.9% increase from the current silver price of $18.35.
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