Silver Price To Rise - It's “One Of The Most Undervalued Assets In The World”

Silver has been a hot topic as of late, and for good reason. The commodity has seen massive gains throughout the first half of the year 2014, and all forecasts seem to be pointing to more growth. In fact, James Turk, a well-respected professional that tracks and invests in silver, said that the precious metal is “one of the most undervalued assets in the world.” Today, we'll talk about what he had to say, why silver is incredibly undervalued, and what we can expect to see from the price of the precious metal moving forward.

James Turk Believes That Silver Will Skyrocket

In a recent interview, James Turk talked about what he's expecting to see from the price of silver. In his interview, Turk explained that silver has been battered and is ready to start climbing again. Between a mix of undervaluation and investor sentiment, he believes that the price of the precious metal is ready to start climbing. Here's what Turk had to say...

“We have been waiting for five years for silver to reverse course and turn higher, Erik, and now it has finally happened. Silver is breaking out to the upside.

The Strength we have seen so far this year is remarkable, and the power silver has shown over the last few weeks is icing on the cake...

In summary, the outlook for silver is spectacular, and my recommendation for both precious metals remains unchanged. Accumulate gold, and if you are inclined to accept the greater volatility, then accumulate silver as well on a cost-averaging program with monthly purchases, or quarterly if it fits your budget. By doing so you are saving sound money, which is a crucially important strategy to help protect your wealth.”

Why Is Silver So Undervalued

The truth is that silver is indeed incredibly undervalued. With gold and silver both being safe haven investments, and both being precious metals, they should move with one another. To an extent they have. However, gold has far outpaced silver.

At the end of the day, there are 9 ounces of silver mined for every 1 ounce of gold mined. Both of these precious metals have the same sources of demand. Based on this metric, silver should be trading at about one-ninth of what gold is trading at. However, that's not what we're seeing. In fact, at current rates, you need more than 66 ounces of silver in order to buy one ounce of gold.

Why the spread between the two got so big is really a mystery. However, if history is any indication, it is going to get smaller, and it's likely to happen soon.

What We Can Expect To See From Silver Moving Forward

Moving forward, I have an overwhelmingly bullish opinion of what we can expect to see from the price of silver. At the end of the day, the precious metal is a safe-haven investment that is incredibly undervalued. This means that there is tremendous upside potential here as global economic concerns push investors to make safer choices. Because silver is so undervalued, when compared to gold, demand for silver will likely spike faster, leading to strong gains in the precious metal moving forward. 

(Image Courtesy of www.fgmr.com)