It was a beautiful day for silver investors.
The moment we’ve been waiting for approaches.
Poor man’s gold broke out to a 13-year high over $36 per ounce, up more than 4% as of 9:30 am.
And the miners? Oh boy…
A silver miner our friends Jim Rickards and Dan Amoss just recommended to members of Strategic Intelligence is up a hefty 9% on the day. (Members can read the full details here in the latest issue.)
Pan American Silver (PAAS), which we mentioned adding to on May 19 at $23.08, is currently up 8% to $28.65 on the day.
The largest silver miner ETF (SIL) is up 5% to $49. We noted the dip to $34 back on April 7.
The major silver miners are flying. Juniors are waking up.
This could be the start of a very lucrative period…
“Something to Behold”
Back in March, in Coming Soon: Silver’s Mania Phase, we discussed the remarkable experience which is a silver bull market.
There is truly nothing else like it in the investment world. The intensity of it grabs ahold and won’t let go.
That article included 2 priceless quotes about silver from Rick Rule, a legend in the commodity investing world. These are well worth repeating:
When a silver bull market gets underway, it’s something to behold… There is a memory investors have of a market that went from $1.50 to $50. There’s an institutional memory and an individual memory…
I have watched now 3 times in my life the silver price flirt with $50… While the gains that were possible in the metal were lovely, the gains that were possible in the stocks, for people who actually did real research, were extraordinary.
One more:
My friend Doug Casey famously said, “the market capitalization of silver [miner] equities is insufficient to accommodate the inflows of capital from generalist investors when the precious metals narrative takes over.
When the generalist investors come in, the result is like trying to siphon the flow of the Hoover Dam through a garden hose.” I’ve witnessed this, and the most dramatic example is Coeur D’Alene which went from around $0.10 to $65.
Tiny Markets, Violent Moves, Durable Catalysts
Both physical silver and miners are tiny markets. So when this precious and industrial metal gets hot, things can get downright violent.
A silver bull market is also a viral phenomenon. The moves are so explosive that word spreads quickly. Millions of momentum and generalist investors rush in through a wee little door.
And in terms of fundamentals, the case for silver couldn’t be stronger. Its use as an industrial metal is absolutely soaring, particularly in solar panels and electronics in China.
Now we’re about to see a wave of investment demand hit the market. And this very well could send us to new all-time highs above $50/oz, then on to $100+ within a few years.
In this world where financial and monetary chaos are certain, it’s not a question of if silver explodes, but when.
When it does, silver has a LOT of catching up to do. And silver miners’ profit margins will go through the roof.
Still Early
A few of you may be thinking “the move already happened, I missed it.” Incorrect.
We are still $14 away from 1980 and 2011 highs of around $50/oz. I continue to buy silver and miners on dips. Yes, there will be dips. Nothing goes straight up.
With that said, these moves in silver can be explosive. So if you’re looking to build a position, now is a fine time to start. Physical is an excellent way to invest. I like 10 and 100 oz bars. Coins are nice too, but you get a bit less bullion for your money. The Sprott Physical Silver Trust (PSLV) is a nice way to get access to silver through your brokerage account.
If you’re looking for an easy diversified miner investment, check out the Amplify Junior Silver Miners ETF (SILJ). Or the larger miner ETF, SIL. Of the two, SILJ has more upside potential. But it will be more volatile.
However, the highest returns in a silver bull market inevitably come from the best individual names. We’ll keep an eye out and let you know what we find.
