You have to be careful with silver.
You’re here because you ostensibly understand the long term trajectory of paper money and its inverse relationship with physical, precious metals.
Which means you’re probably waiting for silver to do what silver does at some point during a gold bull market: spike much higher than gold.
And you’re also probably wondering what kind of investment exposure will profit best during a silver boom.
But there are some serious problems in the silver stock space. I’m going to give you a quick rundown of those problems, but first… there are actually problems with trying to catch silver at the right time, too.
For one: silver is always overhyped.
You can find a dozen essays and news stories about the constrained silver supply, the limited production, how it’s mostly mined as a byproduct so therefore the mining production is not very responsive to market prices, which is why it’s so volatile.
Or you can read about how on the Comex there’s massive amounts of paper silver traded with not nearly enough physical available.
Or how the gold:silver ratio is way out of wack, at over 100:1.
It’s all true. Silver does rise much higher than gold sometimes, and there are real market constraints. There are way too many paper claims on silver. Most silver is mined as a by-product.
All of these little factoids are interesting but they’re not very useful.
Here are some other facts that give you some important context:
Silver price underperforms the gold price 99% of the time.
Eventually it will explode higher for a short period seen in 1980 and 2011.
And Silver now appears to be on the cusp of a historic breakout higher.
This could be the chance to make life changing gains in a once a generation Silver move.
Knowing exactly when this will happen is almost impossible. It’s not enough to know THAT it will happen… these kinds of moves are so fast and dramatic that if you don’t get the timing right, you’ll get crushed.
And look: everyone gets burned in silver. I get it. It’s an exciting metal.
If you’re going to play silver, you need to be very careful about what kind of companies you invest in. GP prefers to play the odds, sticking with the high grade profitable operators that outperform 99% of the time versus betting on “leveraged” low-grade plays that pay off once every 20 years or more.
Most silver companies are total trash.
That’s because most of them are cashing in on the excitement of silver, so they’re run as hype machines not as shareholder friendly businesses.
For one, most of the silver miners sell something called “concentrate,” and they only get paid 85% of the metal value.
Gold miners and pure Silver dore producers get paid 99% of the value for their mined metal.
At the same time, most silver miners end up being unprofitable because they’re not run efficiently… they take shortcuts to bring as much silver as possible to market under lousy terms.
To make up the difference, they constantly dilute shares, issuing new shares into the market whenever they can.
And when silver rips higher pushing share price up they sell even more shares.
I’m only focused on high grade profitable silver miners. There are a small number (less than 5) of silver miners I’ll even consider. These companies (like their gold counterparts) are profitable 99% of the time.
They also produce silver dore bars that they get paid 99% of the value for.
These companies are in a different kind of business than most of the silver miners out there. They’re long term, shareholder friendly businesses that are not focused on short term hype.
One company in the Golden Portfolio 10X service is up nearly 100% since I recommended it. It’s being acquired, but over the past year it’s paid out 30% of its free cash flow in dividends – an absurd (for miners) yield of 5%.
Silver companies can brag about production and mine size, how many ounces are in the ground or how little it costs them to mine… but you can’t fake a dividend. Not at 30% cash flow. That’s an example of a real company that’s focused on shareholders, not hype. Which is why it’s being acquired…
And I’m not trying to downplay silver. The thesis for silver is only 2nd to gold. And it’s going to go much higher, no doubt in my mind.
But everyone plays it wrong investing in the worst and least profitable bankrupt miners.
Be careful with silver.
Best,
Garrett Goggin, CFA, CMT
Chief Analyst & Founder, Golden Portfolio
P.S. Most silver investors get burned chasing hype. In Golden Portfolio 10X, I cover a select group of silver investments that generate real profits—and return that cash to shareholders.
One has already returned 32.2% in 2025 alone.
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