This seems opportunistic for silver buyers. I read somewhere, from the years 1000-1873, there was a 10:1 ratio, and somewhere in the early 1900's, it was set at 16:1. It also seems, to me, that it's so out of whack, that maybe there is very little relevance in terms of predicting prices? I'd be interested if this is a good way to see silver as a great buy, someone much smarter than I, and if there really is a correlation between gold/silver prices.
Well, there certainly is a lot of speculation regarding whether the GSR will drop to lower levels. I personally would not be waiting for 16 or even 30... But who knows if it won't go back to 40 some day. However to play this would be pretty tricky when holding physical. If you look at the recent instances when the GSR has dropped significantly, the better opportunities occur in spikes. If closely monitoring the GSR, it's possible to capture this, but selling physical in time and buying after that night not be practical. Personally I think it's better played with paper (unallocated for instance).
This is a current interest of mine. You need to work out the actual GSR, not the GSR of spot because when you do a trade there will be premiums involved on both sides of the trade, for instance a dealer might give you spot for your gold but charge you $2 an ounce above spot for the silver. Currently the Gold Stackers unallocated GSR is around 63. Unallocated is a good way of moving metals around without paying for postage or having to post uninsured metals. I am waiting for 65 before I do my first swap.
Totally agree Phiber, that's a paper market game. I am putting all effort into silver ATM. Due to the GSR as it is, silver seems the better proposition being so undervalued relative to gold. That's about the only reaction I am taking to the current GSR, that I'm backing right off my gold purchases. I'm not at all into the trading game nor am I slightly interested in selling gold to purchase silver., Although some would certainly argue this is a good strategy with such a high GSR I can't really see enough advantage in doing this especially with the postage costs associated with trading physical back and forth. Edit. Sorry jislizard, looks like we were both writing at the same time and I did not see your similar post until after I posted mine. Seems we were both on the same track at the same time.
