The Silver To Gold Ratio

Questions? Speak to a specialist at (800) 781-5308. 6 is shrinking. At today’s gold price near $1300 per ounce, one could now make a case for silver at $144 per ounce based on the production ratio of 9:1. Using the AGAU Formula to Time Your Purchases It should now be apparent. There are times when it is better to own one metal over the other. There are also times when it is prudent to trade one metal for the other. With the AGAU ratio now near 80:1, it appears likely that ratio will fall as it has done 8 other times over the last 35 years. That means either silver has to rise in price to lower the ratio or the gold price has to fall. Currently, it is not likely the gold price will fall as it now trades at a price near what it costs to produce it. The same can be said for silver. That said, a metals portfolio weighted heavier on the silver side, today, seems prudent. Then, when the ratio falls, trade the silver you own today for gold. Doing this over time, as the ratio fluctuates higher and lower, could be a great way to multiply your metals holdings. To illustrate just how effective use of the AGAU formula can be in timing your metals purchases, we can look back at history and chart the activity. The chart below shows what would happen if you could optimally time your purchases and trades. See how starting with $5,000 invested in each metal (total of $10,000) could turn into more than $13 million paper dollars over a 43-year period. We begin charting in 1968, a time prior to Nixon removing us from the gold standard. We start our exercise with the purchase of $5,000 worth of gold Results based on spot prices of precious metals and do not include transaction fees. Above example is an optimally timed execution and individual efforts will vary.