Silver may not be as hot as gold as far as global investments are concerned. But silver continues to grip the investment sentiments of bullion traders and dealers across the world.
According to a new report from Citigroup, silver will outperform and outshine gold.
The global bank said on Thursday that investment flows into gold are moderating while the outlook for silver is improving.
The ratio fo gold-to-silver prices should return to its historical norm between 55 and 60 from the current 69, it said.
Citigroup upgraded Fresnillo and Peter Hambro Mining to buy from hold, downgraded Randgold Resources to hold from buy and upgraded Hochschild Mining to hold from sell on reduced balance sheet concerns and the silver outlook.
Silver has outperformed gold so far this year. While the precious metal remains 35 per cent below its March 2008 high of $21.44 per ounce, its up 24 per cent compared to only 5.3 perc ent for gold. So far this month, the spot price of silver has risen 14 per cent.
On February 24th 2009, the aggregate trading in silver futures reached a high of over 81,900 contracts.
Over the medium to long-term the silver market is forecasted to remain robust. According to the Silver Institute’s World Silver Survey 2009, “Healthy investor interest in physical silver is expected to continue in the coming months, driven by continuing economic woes and uncertainty over the health of the financial services industry.”
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