Is there a buying opportunity for silver?
Silver prices have fallen since the outbreak of the conflict in Iran, but experts say the longer-term structural drivers are still positive for the precious metal.
The price of silver reached its lowest level of 2026 so far on 11 June before reports of an end to the Iran conflict pushed the precious metal higher later in the day.
The silver price closed at $67.52 per ounce – 5% below its level at the end of 2025 and 28% below its close price on 27 February, the day before the conflict broke out.
Silver sold off steeply in late January when it became clear Kevin Warsh was the likely pick as next chairman of the US Federal Reserve, a position he now occupies. Warsh is regarded as relatively disposed to higher interest rates compared to other candidates who were in the running; higher US interest rates are typically a headwind for gold and silver, so prices fell as the markets factored in revised interest rate expectations.
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The war in Iran compounded this effect by pushing up global inflation. Given explosive gains for both metals last year, gold and silver both served as a source of liquidity for investors following the conflict’s outbreak.
Silver carries much of the same appeal as gold for investors, but benefits from additional demand thanks to its key role in advanced industrial technologies such as artificial intelligence (AI) data centres, electric vehicles (EVs) and solar technology.
“Silver tends to move a little bit like more volatile gold,” said Cosmo Sturge, director of market strategy at metals fund manager Baker Steel. “It tends to move directionally with gold, but with a little bit more volatility.”
If you’re deciding where to invest, does silver make sense now?
Why invest in silver?
While silver, like gold, is a precious metal with a rich history of usage in coinage, in the modern era it is silver’s industrial qualities that have the greatest bearing on its price.
“Historically, there would have been a closer relationship between silver and gold in their end uses,” Robert Crayfourd, portfolio manager of the Golden Prospect Precious Metals investment trust, told MoneyWeek. “But today, silver is over 50% industrial, and that’s primarily going into high-end electronics.”
Anything you can see around you with an on/off switch likely contains silver.
Other industrial use cases include brazing and alloys, the chemicals industry and medical equipment – the latter benefiting from the fact that bacteria cannot grow on silver, an inert ‘noble’ metal.
For these reasons, silver sometimes tracks action in copper prices more than gold.
Many of the same drivers that impact the gold price – financial stress, interest rates, inflation expectations and policy decisions – also influence silver.
Is now a good time to invest in silver?
In the short term, silver is under pressure – though reports that the US and Iran had reached a more lasting ceasefire, including an immediate re-opening of the Strait of Hormuz, saw silver prices rise on 11 and 12 June.
But there are various structural drivers in place that suggest silver prices could rise over the long term.
Silver is at the heart of boom industries like clean energy, AI and defence.
The Silver Institute, an industry body for the silver industry, and advisory firm Oxford Economics, published a report titled ‘Silver Demand Forecast to Expand Across Key Technology Sectors’ in December. It highlighted three major growth industries that are driving silver demand: solar photovoltaics (i.e. solar panels), electric vehicles (EVs) and AI data centres.
Silver is an important material for all three industries and their pace of growth is fuelling rapidly rising demand for silver.
The supply of silver may struggle to keep pace. While demand for silver is expected to have fallen around 4% in 2025 thanks to tariff uncertainty, it still lags supply, which The Silver Institute expects to remain flat.
That will have made 2025 the fifth successive year in which demand for silver has outweighed supply.
“What is really striking with silver is the supply side,” said Sturge. “While it has all these demand drivers, on the supply side it is more constrained than gold, because it’s a byproduct. There are very few silver mines globally.”
Between 2017 and 2025, total annual demand for silver increased around 16%, from 972 million ounces to 1.13 billion. Over the same period, supply only increased by 6%.
So the long-term drivers of silver prices seem supportive, meaning that the pullback in recent months could be viewed as a good buying opportunity for would-be silver investors.
Should you invest in silver or gold?
Their historical significance as precious metals used in coinage means that gold and silver are often directly compared by investors. The gold-silver ratio is reckoned to be the oldest continually-tracked financial ratio in existence. It describes how many ounces of silver are required to buy one ounce of gold. The higher its number, the more expensive gold is currently, compared to silver.
The gold-silver ratio is approximately 63 at the time of writing, having fallen from as high as 104 in April 2025 during the height of the year’s tariff turmoil.
At the start of 2026 the gold-silver ratio was above 90, indicating that silver has become cheaper relative to gold throughout the year so far. However, the ratio has increased sharply since early February, when it fell to the mid-40s.
How to invest in silver
There are various ways to invest in silver.
You can, in theory, buy physical silver in the form of silver coins or bars. These, however, incur 20% VAT, and also include 10-15% dealing spreads on top.
Specialist custodians can enable you to avoid sales tax while cutting this trading spread too. Using a custodian should also save the expense and risk of storing and insuring physical silver on your own property, as they will normally store your silver in a professional level vault.
Alternatively, you can gain exposure to movements in silver prices by buying a physical silver exchange-traded commodity (ETC). An ETC behaves similarly to an ETF, but it tracks the spot price of a particular commodity, as opposed to a bundle of stocks. The iShares Physical Silver ETC (LON: ISLN), for example, tracks the spot price of silver.
Buying shares in silver miners is another way to invest in silver. However, bear in mind that this is a different and arguably riskier investment than in physical silver or a tracker for the spot price, because while changes in the silver price will impact the share prices of silver miners, they are also exposed to other, unrelated factors, such as company mismanagement. Mining stocks tend to be more volatile than the commodities in which they focus.
An ETF which comprises silver miners, such as the Global X Silver Miners UCITS ETF (LON:SILV), can give you diversified exposure to silver miners. While doing so may dilute some of the company risk associated with buying individual silver miners, this should still be considered a distinct play from investing in physical silver (either directly or via an ETC).
Golden Prospect Precious Metals (LON:GPM) is an investment trust that invests in a diverse portfolio of precious metal miners. Similarly, Baker Steel’s Gold & Precious Metals Fund offers exposure to precious metals miners that are selected using a rigorous, bottom-up research process.
