While gold will continue to grab investors’ attention as economic uncertainty dominates financial markets, a research analyst said on Wednesday that silver needs to be the metal to watch.
On Tuesday, a broad rally in precious metals helped push silver back above $18 an ounce. While gold’s breakout above $1,600 an ounce grabbed most of the headlines, silver’s gain outpaced gold’s by more than a percentage point. Silver continued to hold onto most of Tuesday’s gains, with march silver futures last trading at $18.28 an ounce, up 0.74% on the day.
Lior Gantz, founder of Wealth Research Group, said in an interview last month that silver’s ability to outperform gold is why investors should look at silver. Gantz added that he expected gold and silver prices to be bullish in 2020 as inflation could pick up for the first time in more than a decade as central Banks around the world continue to flood markets with liquidity.
“We are already seeing investors anticipating higher inflation and buying gold before the first quarter data really come out,” he said. “When inflation does pick up in the second and third quarters, we will really see an increase in purchases.”
Gantz said higher inflation is expected to push gold to $1,650 an ounce. However, he adds that the real inflation hedge is silver and the metal to watch is silver.
“I can see silver really catching up to gold by 2020,” he says. Silver has no geopolitical premium; It’s the real inflation indicator in the market.”
Gantz added that in gold and silver trading, investors should increase their holdings of silver rather than gold. He added that he expected silver to rise to $20 an ounce this year. In the current environment, he favours the idea of buying silver options, and investors should focus on the best silver miners in the market.
He says his favorite Silver miner is Fist Majestic Silver. The veteran silver producer is currently a client of Gantz’s portfolio companies. “Keith Neumeyer, chief executive of Fist Majestic Silver, is very confident about his mines. No one knows more about silver mining than he does, “he added.
On Wednesday, First Majestic reported that 2019 silver production would hit a record 25.6m ounces. The company also said its operating activities generated a record $140 million in cash.