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Investing in Silver with Mining Stocks

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The whole process of investing in silver has been made confusing by the changes in the industry and the hype surrounding prices.  Changes in politics and the economy has led to precious metals becoming a hot commodity for plenty of investors.  Once you have figured out that precious metals are where your going to put your investment dollars the next logical step is to figure out where.  You have to choices when it comes to investing in precious metals you can buy the metals themselves or you have the option of investing in mining industry.

Buying Silver Stocks

Stocks in silver mining companies can be bought with a simple phone call to your broker, or online depending on how you buy your stock.  However you should focus on stocks from companies that are prospecting and mining silver themselves.  There are many companies out there that don’t produce silver and they may never produce silver making it a very high risk stock.  Buying silver doesn’t have to be risky though.  Here is a video on why you should by silver stocks.

Why Silver

Despite being viewed as gold’s poor cousin silver, it is still a fairly safe investment.  Silver has more practical applications than gold.  Silver is used in jewelry, solar energy, dentistry, photography, batteries and LEDs, whereas gold isn’t used in that many industries.  This does make silver prices more dependent on what is happening in the industrial world.  This does give silver more volatility in terms of price but that can be lucrative if you read the market right.  You can capitalize on buying either silver bullion or silver mining companies.

The stock market got off to a slow start in the beginning of this year, but the prices of gold and silver have risen despite the performance of the stock market.  By the middle of February both gold and silver had made 15% gains in price.  Silver can outperform gold under the right conditions and it is much cheaper to get  than gold.  However silver prices are affected by far more outside than gold.

Buying mining stocks are no different than  investing in any other company.  You need to do your due diligence and look at more than the stock prices.  Look into as much financial information on the company as you can and don’t forget the market conditions either.  Silver prices will also rise when demand from the manufacturing industry rises.