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Could The Price of Silver Ever Reach $1,000 Per Ounce?

A close-up image of Silver 9Fine Mint products, including one 10 oz Silver round and bar.


Learn About the Argument for (and Against) Silver at $1000

Update: This article has been updated to account for current events and new price information.
Silver has generally been viewed as a more affordable Precious Metal to invest in than the more expensive Gold. With silver, an individual can get a lot of silver for their dollar and still get physical silver rather than certificates or silver proxies such as stocks and indexes.
However, in 2016 a debate was sparked after an interview with the CEO of a major silver mining company was published. He voiced the opinion that he could see the price of silver rise to $1,000 per ounce if the gold spot price ever rose to $10,000 per ounce. This was met with much skepticism and since then that has clearly not been the case, but this article will break down his claim and its likelihood.

The Case for Silver at $1000 an Ounce

An essential point emphasized is the difference in production and pricing between Gold and Silver. At the moment, the silver output is about 9 times that of Gold. As a result, the claim was made that silver should currently be trading at around $130 per ounce, or approximately 1/9 the price of Gold. That would suggest we should be trading at nine to one, which would put gold at $2,016 and silver at $224 an ounce.
He thought that with the rate those precious metals are mined in 2016, that’s where silver should be trading at. In that year silver and gold were trading at 75 to one, so this was unlikely to happen. And today, the current silver to gold ratio is 80:1. The lowest the ratio has gone since the initial prediction was made was just under 65:1.

Why $1000 per Ounce Silver is Unlikely to Occur

The price of Silver is currently about $25 per ounce. At its peak, Silver was at around $50 per ounce, so it would have to rise more than 200% in order for it to reach the $50 mark. It would need to increase 40x to reach $1,000 an ounce from today’s numbers.
The claim that a 9:1 ratio should be used to peg silver to the price of gold considers supply but does not account for demand. It also does not account for elasticity of supply and demand and the differences between gold and silver. It’s important to note that as the price of gold increases, demand and supply will adjust, and silver will do the same but at different rates. This means the price will further adjust differently. A 9:1 ratio has never been the standard for the gold to silver ratio and we don’t expect that to change.
In short, it is highly unlikely that the price of Silver will reach $1,000 per ounce. Silver is used more industrially than Gold and its price does not react the same way to economic events. While Silver’s price can react dramatically to changes in the economy, it is unlikely that Silver will reach $1,000 per ounce, though we do not discount the possibility of triple digit silver in the coming years.

How Silver Typically Performs

The Silver spot price is generally stable when compared to other asset classes, though it varies more than gold. Over the past few years, Silver has seen an increase in price. Silver usually performs poorly when economies are performing poorly, and this is because Silver has heavy industrial use. Investors become more wary of silver when recession risks are looming due to historical performance. Under a dollar cost averaging strategy, silver tends to outperform gold. Over the long run gold tends to average just over a 3% return on investment while silver tends to perform a little over 7% return. To get to $1000 an ounce, these historical norms would need to be disrupted by serious black swan events that would have ramifications globally. A sudden jump would mean an increase in returns to 4,000%. There is some historical precedent for an increase like this, where we saw a 37x increase in the price of silver leading up to 1980’s historical high, but to get this you have to cherry pick the lowest price in the 70s and the highest price in 1980. The odds of an investor winning big by buying at the lowest point in a ten-year stretch and timing it perfectly to sell at the highest point are low.
The Silver price per ounce can fluctuate based on geopolitical events around the world. A notable and recent example was the Covid-19 pandemic. When the pandemic first became well-known in February and March of 2020, the price of Silver plummeted from $18 per ounce at the start of the year to under $12 per ounce in March. It recovered and went to over $30 an ounce with extremely high demand for physical metals, and currently trades around $25 an ounce in 2023. Factors like the banking crisis in March of 2023, or the war in Ukraine in early 2022, can affect the price of gold and silver alike.

Key Takeaways

Even if silver is highly unlikely to reach the $1,000 mark, there are still reasons to buy silver today. Silver is a more affordable precious metal than gold and while it tends to be more volatile, it also yields higher returns than gold. It might not be silver’s time to reach $1,000 just yet, but it is still a valuable precious metal worth investing in. With bullish trends developing for its industrial use cases, historic demand for silver bars and coins sustaining for multiple years in a row, it’s likely that silver will continue to provide real returns and a safety net for investors for years to come.


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