Trade silver: Silver Trading How to Trade Silver CFDs


The level of oil prices often stems from current geopolitical development and the resulting overall uncertainty in the markets. In times of crisis or war, we can also see an increase in the price of oil. And the price of oil usually goes hand in hand with the price of silver. Again, this is due to the search for the already mentioned «safe harbor», i.e. an investment that is suitable in times of crisis. The content on this website is provided for informational purposes only and isn’t intended to constitute professional financial advice.

Silver stocks will usually have a positive correlation with the commodity’s price – as when demand for silver rises, these companies earn more from their discoveries. However, as there is a range of metals to consider, it’s important to keep an eye on the demand for those assets too. The company’s growth and stock returns will also influence the share price, and can be influenced by everything from news and earnings releases to production costs and hedging activities. Some major silver industry players include Endeavour Silver Corp and Barrick Gold. Silver spot pricesenable you to trade the current price of silver, at that exact moment in time or ‘on the spot’.

If the gold-silver ratio fell below one, then silver would overtake gold as the most valuable precious metal. Silver can be a highly volatile market, creating opportunities to profit from price swings, but also presenting the risk of losses. As with the other trading strategies, it is important to have a risk management plan in place. Remember that past performance never guarantees future results and the asset’s price can turn against your position.

How to choose a broker suitable for silver trading

IG International Limited is part of the IG Group and its ultimate parent company is IG Group Holdings Plc. IG International Limited receives services from other members of the IG Group including IG Markets Limited. Authorised and regulated by the National Bank of Slovakia and Emerchantpay Ltd. which is authorised and regulated by the Financial Services Authority of the United Kingdom.

futures contract

Normally, futures are traded between parties without the physical delivery of any silver. This has caused the silver futures and options markets to explode. It is almost always the case that when gold rises so does silver. There are many ways traders analyze the movement in the price of silver. Most of them are used more generally in the analysis of commodities. Check out our section Technical Analysis in day trading for detailed information.

Obviously the best precious metal for any trader is the one they understand the best, but for those just getting started in precious metals trading silver can be an excellent place to begin. Silver is one of the rarest metals on earth and is considered a high-demand commodity by many traders. The Silver trading symbol Is YI. While Silver is less rare than gold, its role affects the currency markets significantly and works mostly in tandem with gold trading prices. As it is one of the most versatile of metals, it can be used as both an industrial metal and a hard asset and plays a double role in the commodities market.

What is a troy ounce of silver?

You can do it via a broker on a stock exchange, just as you would trade any other stocks or funds. Changes to central bank policies on interest rates can reduce the attractiveness of silver relative to other assets. Higher interest rates could make silver less favourable than interest-bearing savings accounts and other financial instruments. People have used silver as a store of value and an investment vehicle for centuries.

Therefore, options traders must be right about the size and timing of the move in silver futures to profit from their trades. Between 74-89% of retail investor accounts lose money when trading CFDs. The information on this web site is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient.

Day trading silver strategy would be similar to scalping but can involve holding a position for hours rather than minutes. As with scalping, day trading makes use of technical analysis to identify the levels to enter and exit positions. Silver is seen as a safe-haven asset that could hold its value during times of uncertainty, when stocks and bonds tend to fall in price. The gold-silver ratio refers to the number of ounces of silver needed to buy one ounce of gold. Traders look at the gold-silver ratio to gauge the performance of silver relative to gold. At expiry, we’ll roll over your futures contract into the next month, unless you close your position.

All the previously mentioned reasons to trade silver can be considered in the case of gold as well. It also preserves value, resists inflation and its price tends to rise in the long run. However, gold is approximately 75 times more expensive than silver, which makes it a relatively financially demanding investment. So if you decide to buy gold in physical form, a brick weighing 1000g will cost you almost € 55,000. In the case of silver, the price of a brick with the same weight is approximately CZK 750.

The gold-silver ratio typically rises during bear markets and falls during bull markets. Gold becomes more expensive than silver in economic downturns, as although both are safe-haven assets, gold experiences significantly more attention than silver. Once the economy begins to recover, gold’s value falls back and trades nearer silver’s value again.

If, for some reason, a certain commodity’s price drops, people who own it are left with the physical product at a low value. However, when having a CFD position opened, all the trader needs to do is close it, thus minimising the risk he takes. Futures CFDs derive their pricing from underlying futures contracts, while silver CFDs derive their pricing from the underlying spot market. For a complete overview of all the silver instruments available to trade and their active time zones, view our product schedule. Silver futures contracts are standardised agreements to exchange silver for a set price on an agreed date.

Options are also derivative instruments that employ leverage to speculate on commodities. However, options also have a strike price, which determines whether the option has value at expiration. Increases in silver trading demand can result in significant increases in prices, particularly when supply remains constrained. When acquiring our derivative products you have no entitlement, right or obligation to the underlying financial asset.

day trading

If you are not interested in speculating on silver prices in the short term, but would rather want to invest in silver in the long run, we would rather not recommend this method of trading. Like the many other instruments we offer for trading, Silver is not physically bought or sold, rather traded on its price, known as Contract For Difference . When trading Silver CFD, the trader doesn’t own the instrument but can benefit from the changes in its value. The contract is between the trader and the broker, and the prices are derived from the real instrument price. As Silver is not a very common commodity, not every trader can gain easy access to it, especially when the minimum amount for purchase is 100-units.

Trading silver with Axi gives you the benefit of investing in one of the world’s most popular and trusted commodities without having to actually take ownership of any physical raw material. Head over to the City Index Academy for curated courses designed to get you started on the markets. A range-bound strategy is useful when the silver market is in a period of consolidation and prices are relatively stable. Production from silver mines is expected to drop in the long term due to lower recovery rates from ore in the ground and a lack of new mining projects. There are several factors that could influence the silver price direction. IG International Limited is licensed to conduct investment business and digital asset business by the Bermuda Monetary Authority.

Options buyers pay a price known as a premium to purchase contracts. An options bet succeeds only if the price of silver futures rises above the strike price by an amount greater than the premium paid for the contract. All trades have potential risks and rewards, so traders should take all information into account before risking their money. Silver reached all-time highs since its sharp decline in 2012 and 2013.

Learn about the relationship between silver and gold

Speculators could find that their silver purchase is behaving with similar volatility to a stock. Futures contracts trade globally on the CME Globex electronic trading platform and have a variety of expiration months. The value of a CFD is the difference between the price of silver at the time of purchase and its current price.

Silver is a way to bet on growing global industrial demand for metals. But even if industrial demand for silver remains fairly consistent, trading demand can be much more variable. For this reason, silver is more likely than financial assets to hold its value during periods of turmoil. Silver is a precious metal that has long been valued for its use in jewelry, mirrors, and as currency coinage.

Advantages of Trading Silver

Silver was adopted as a currency in the Greek and Roman empires, as well as other civilisations in Asia including China and Japan, where silver coins were used in international trade. Silver is commonly found in the process of extracting other metals from the ground. For example, copper ore mining accounts for 26% of all silver finds – so if demand for copper spikes, it can lead to a rise in silver supply.

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