Silver vs. Gold Investing Dilemma is Here Again: Should We Trade Volatility Tolerance for Higher Momentum Potential?

Inflation, geopolitical tensions, and the anticipation of upcoming interest rate cuts — all have contributed to a significant increase in gold (XAUUSD) investment in the recent months. As a result, the spot price for the bullion has repeatedly refreshed all-time-highs, surpassing $2,400 per ounce in late May.

For individuals who are currently considering purchasing gold, the recent price rally may give them reason to hesitate. However, for investors seeking greater potential short-term profits, it is silver (XAGUSD) that might be a more favorable option, provided they have a higher tolerance for volatility. Silver prices tend to fluctuate more due to its numerous industrial applications and its relatively abundant supply compared to gold.

In the comparison between gold and silver, it is evident that silver possesses a higher Beta value than gold. In the event of a rally in precious metal prices, it can be expected that silver will experience a more substantial increase in percentage than gold. Conversely, if the prices of precious metals decline, silver is likely to undergo a greater percentage decrease.