Silver ETFs - The Best Hedge to a Falling Dollar?
3.8.08
By Ryan Moxie
What is going on with the declining dollar these days? Commodity ETFs are rising, that's what. This could be because investors are coming to the realization that when the dollar goes down, precious metal commodity exchange traded funds (ETFs) won't be going anywhere. Commodity exchange traded funds include currencies and Earth derived product such as gold, silver, natural gas, crude oil, crops and livestock. Commodity ETFs securities baskets traded like a stock.
Silver exchange funds are getting more popular since their introduction to the commodities ETF trade not so very long ago. Silver ETFs gained more than 7% in their first day of trading. Silver has grown to be one of the most popular metal commodity exchange traded funds on the market. It is true that gold exchange traded funds did much better in their first few weeks of trading, and still is, but silver ETFs have certainly opened some eyes.
Today, silver exchange traded funds have volatile, up one day and down the next. It is hard to know where it's going. But what does seem clear is that when the dollar declines, silver almost always and immediately shows a significant rise. If you think you know where the dollar is going to go, silver ETFs could be something to consider for your portfolio.
Some analysts tell us that silver exchange traded funds are not a good investment for the long term, while others advise people to use metal commodities as a hedge to protect against the fast declining economy. With silver exchange traded funds so volatile, advisers say that it might not be a bad idea to hold them for a short time and then sell part of them to reinvest into real silver, or something else that is more stable.
Investors still seem a bit wary of silver ETFs and other metal commodity exchange traded funds because they want to know if the actual precious metals are truly in a secure vault somewhere, and who is watching over it, or if someone is backing their certificates with a promise. The best answers to these questions will come from the administering firm of the silver exchange traded fund. Give them a call and find out what you need in order to make an intelligent decision.
Silver is used in industrial manufacturing quite a lot. Silver commodity exchange traded funds rely on supply and demand. If the silver mining is failing to produce more silver, then the supply will fail to meet the demand and the price of silver will go up. With that thought, isn't the time to buy silver exchange traded funds while the price is still down?
One analyst/adviser suggests that you carefully consider silver ETF's pros and cons before buying a lot. If you find that silver is right for you, then you should by all means invest in it. If you decide that silver exchange funds don't meet your current needs, then there are sure to be other commodity ETFs that are.
Ryan helps you understand ETFs and how you can profit with commodity silver ETFs
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