Unlike gold, silver is traded not only as a financial asset. This precious metal is widely used in manufacturing.
However, most investors start trading silver to earn profit from price fluctuations.
Who trades silver (and why)?
Traders and investors buy silver for three main reasons:
- As protection against inflation;
- As investment;
- As a remedy against the financial crisis.
Silver trading has recently become very popular. Earlier, the traders focused mainly on gold. However, an increase in the price of this precious metal made many of them switch to other investment options.
Silver is becoming more and more popular with the traders. There are three methods of trading silver in Forex:
- Intraday trading. The deals are opened and closed on the same day and can’t be delayed. A position can stay open from several minutes to a full trading day. The trading can be up trend, down trend, and sideways trend. The work is carried out swiftly and takes discipline. The trader needs to respond to the smallest changes and wait for the right moment to enter into a deal. It is advisable to conclude several deals to make a good profit.
- Medium-term trading. The deals are concluded for a period of up to a few weeks. This type of trading requires knowledge of technical and fundamental analysis. Unlike intraday trading, you don’t have to sit in front of the screen and track the data all day, and even one successful deal can bring you a good profit. This trading method allows you to earn much money in almost no time. However, it is very important to understand when to place Stop Loss and Take Profit orders. Beginners should be very careful with this method because medium-term trading is the abode of experienced traders with a big deposit.
- Long-term trading. The deals last several months. This is the calmest and slowest type of trading, optimal for working with metals. We recommend you to make investments in small portions, as the market position is always unstable, and you can easily lose all money. Trading success depends on the duration of the trends. The trader’s task is to catch the financial peak and close the deal on time. Experienced traders advise beginners to use this method.
You can use any of these methods to successfully sell or buy silver; however, traders usually prefer the latter two. They hold the goods for a long time (sometimes more than a year) to sell them for the maximum price.