Gold vs Silver: Which Should You Buy?
Both metals have their place in a portfolio, but they serve different purposes. Here's how to decide based on your goals, budget, and storage situation.
Gold
- ✓ Better store of value
- ✓ More compact wealth storage
- ✓ Lower premiums (% basis)
- ✓ More stable price
- ✗ Higher entry cost per ounce
- ✗ Less upside potential
Best for: Wealth preservation
Silver
- ✓ Lower entry cost
- ✓ Higher upside potential
- ✓ Industrial demand growing
- ✓ More "bang for buck" feeling
- ✗ Bulky storage requirements
- ✗ Higher premiums (% basis)
Best for: Growth & smaller budgets
The Gold-Silver Ratio
The gold-silver ratio tells you how many ounces of silver it takes to buy one ounce of gold. This ratio helps investors decide which metal offers better relative value.
Historical Average
60:1
Current Ratio (Dec 2025)
~85:1
Implication
Silver undervalued
When the ratio is high (80+), silver is historically cheap relative to gold. When it's low (40-50), gold is the better relative value. Currently at ~85:1, the ratio suggests silver may offer better upside.
Storage Comparison
This is where gold wins decisively. Here's what $50,000 of each metal looks like:
| Factor | $50K in Gold | $50K in Silver |
|---|---|---|
| Approximate Weight | ~19 oz (1.2 lbs) | ~1,600 oz (100 lbs) |
| Storage Size | Fits in a shoebox | Multiple large boxes |
| Home Safe? | Easily fits | Need large safe |
| Depository Fees | Standard | Often higher |
Gold's density makes it 50-80x more compact per dollar of value. If storage space is limited, gold is the practical choice.
Premium Comparison
Premiums work differently for each metal:
Gold Premiums
- • Gold bars: 2-4% over spot
- • Gold Eagles: 4-6% over spot
- • Lower % = more metal per dollar
Silver Premiums
- • Silver bars: $1-2/oz over spot
- • Silver Eagles: $3-5/oz over spot
- • Higher % = less value recovered
Example: At $30/oz spot, a $4 premium on a Silver Eagle = 13.3% markup. At $2,600/oz spot, a $130 premium on a Gold Eagle = 5% markup. Gold gives you more metal value per dollar spent on premiums.
Which Should You Buy?
Buy Gold If...
- ✓ You have $10,000+ to invest
- ✓ Storage space is limited
- ✓ You want stability over upside
- ✓ Wealth preservation is the goal
- ✓ You might need to transport/move it
Buy Silver If...
- ✓ You have under $10,000 to invest
- ✓ You have adequate storage space
- ✓ You want more potential upside
- ✓ You enjoy the "stacking" hobby
- ✓ You believe in industrial demand thesis
Buy Both If...
- ✓ You can afford to diversify
- ✓ Common allocation: 70% gold / 30% silver
- ✓ Or 60/40, 80/20 based on goals
- ✓ Rebalance based on gold-silver ratio
Our Recommendation
For most investors, gold should be the foundation of your precious metals allocation. It's more practical to store, has lower premiums, and serves better as a wealth preservation tool.
Add silver for upside potential and diversification—but be realistic about storage requirements. A common starting point is 70% gold / 30% silver by dollar value.
With the current gold-silver ratio above 80:1, silver offers relatively better value. But don't over-allocate to silver at the expense of gold's stability.