Unlike other commodities, I’d hate to say it, silver and gold have little real value.
Silver and gold have little use. They may be used infrequently in industry, tooth fillings, etc. But the majority of it’s price determination comes from speculators. Speculators determine the current price, so that’s why gold and silver haven’t much real value.
So when investing in gold and silver, do not use the strategies of value investing. Use what the speculators are using, which is technical analysis.
However, be careful with gold (although I don’t know too much about it, I’m a silver follower). If George Soros is selling it, and your grandma is buying it, I’d have to wonder who’s going to get hurt. Take a wild guess.
Source: New York Times