3 Answers
Gold serves many functions today: As the American currency weakens, gold acts as currency substitute. What I mean here is that people who typically hold U.S. currency now own gold instead. Gold is a hedge against many things as well: against inflation (though not as much any more), against uncertainties such as war, natural disasters, bad stock market, etc. People in China and India are the greatest buyers of gold for investment as well as for jewelry. Gold also has many industrial uses too.
On the other hand, silver is not used for jewelry as much as gold. The other uses are mostly industrial related.
Technically it is possible for silver price to go down in bad economy and have gold price go up because of nervousness in the market.
With the explanation given above, it is obvious the price of gold tends to fluctuate more than silver.
13 years ago. Rating: 2 | |