"GOLD" or "SILVER"? Which One Provides More Profit and When?

      The chart below shows the course of gold and silver valuations since the beginning of 2020. In the chart, black represents gold and blue represents silver.

     The section marked with the number 1 indicates the bottom level in September 2022 for both gold and silver, and the section marked with the number 2 indicates the peak valure in May 2024 for both.

     In the section from 1 to 2, gold increased by 51.77%, while silver gained 85.18% in the same period. In other words, the return of silver was well above gold.

     In the section from 2 to 3, that is, from the peak in May 2024 to the present, gold increased by 19.98%, while the increase rate of silver remained at 1.31%. Therefore, the difference between gold and silver in terms of return is closing.

     Now I will give you a very important tip. Note that there is a 100-fold difference between the scaling in the left column showing the silver price and the scaling in the right column showing the gold price. When the black and blue curves in the graph approach each other as if they are about to intersect, that is, when the gold price increases to around 100 times the silver price (sometimes this remains at 95 times, sometimes it can reach 115 times), in such cases, silver usually makes a reaction jump in a short time and the blue curve widens difference with the black curve again.

     We can also follow this situation in a much wider time range in the logarithmic scaled graph created since the beginning of 1990. As you can see, the blue silver curve is generally above the black gold curve. However, in some cases, these two curves come close to each other. In the period following this convergence, silver performs better than gold.

     Of course, there is an easier way to follow this correlation. The Gold/Silver Ratio chart provides us this opportunity.

     If you recall from the previous chart, silver had widened the gap between gold and silver in April 2011 and reached its peak value. Since that date, gold has gained more. This situation is shown with the orange arrow.

     It is possible to roughly divide the chart into three. When the Gold/Silver Ratio is between 30-60 gold and when it is between 75-115 silver are more advantageous in terms of performance. Today, we are at 89.26.