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The Case for Silver

Well-known precious-metals investor Eric Sprott has done extraordinarily well investing in the precious-metals space through his funds and also his publicly traded company, Sprott Resource. His asset management company also runs Sprott Physical Gold Trust (NYSE: PHYS  ) and Sprott Physical Silver Trust (NYSE: PSLV  ) . The two trusts allow you to hold physical gold and silver, giving investors an ownership in the metal as opposed to futures in the metal like other ETFs (click here for more details). Sprott is 70% invested in the precious-metals space and doesn't believe in "diworsification," or the diversifying into ideas other than your best bets.

In this video he lays out his macroeconomic views and why he's excited about silver:

If you don't have the time or inclination to watch, here's a brief summary:

  • The past decade has been a disaster, with huge growth in debt with little gains. From 2000 to 2010 new home sales went from 1.6 million to 275,000, car sales went from 20 million to 11 million.
  • Gold is the only currency to have increased in value, and it's not a bubble since it makes up such a small share of total global assets.
  • Sprott is most excited, though, about silver; it's his biggest investment, and he believes the data on silver significantly understate demand for the metal.

Since the video, silver has risen 50%, with some producers like Hecla Mining (NYSE: HL  ) rising even more. The Fool's precious-metals guru, Christopher Barker, still sees opportunity in the space. Chris's favorites include Silver Wheaton (NYSE: SLW  ) , which he believes will rise to $100. Among small-cap stocks he likes Great Panther Silver (AMEX: GPL  ) for its growth and recent listing on a major exchange and Endeavour Silver (AMEX: EXK  ) , also for its growth.

For more reading on silver check out Chris's recent expose on the silver market, "The Presidents' Day Silver Short Squeeze," and his "10 Top Gold and Silver Stocks for 2011."

Dan Dzombak's musings and articles he finds interesting can be found on his Twitter account: @DanDzombak.

The Fool owns shares of Sprott Physical Gold Trust ETV. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

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Related Tickers

10/25/2016 4:02 PM
EXK $4.53 Up +0.15 +3.42%
Endeavour Silver CAPS Rating: **
GPL $1.40 Up +0.09 +6.87%
Great Panther Silv… CAPS Rating: ****
HL $5.97 Up +0.20 +3.47%
Hecla Mining CAPS Rating: ***
PHYS $10.57 Up +0.05 +0.48%
Sprott Physical Go… CAPS Rating: ***
PSLV.DL2 $0.00 Down +0.00 +0.00%
SLW $24.29 Up +0.44 +1.84%
Silver Wheaton CAPS Rating: ****