Insights 
VT 
Silver prices decreased on Tuesday, trading at $51.64 per troy ounce. This marks a decline of 1.31% from the previous day’s price of $52.33.
Since the start of the year, silver prices have surged by 78.73%. The Gold/Silver ratio, which compares the value of silver to gold, rose to 80.07 from 78.55.
Silver As A Store Of Value
Silver is often used as a store of value and a medium of exchange. It can be bought in physical forms such as coins and bars or through Exchange Traded Funds.
Factors affecting silver prices include geopolitical tensions and recession fears. Silver, as an asset priced in dollars, is sensitive to changes in the US Dollar’s value.
Silver is popular in industries such as electronics and solar energy due to its high conductivity. The demand in regions like the US, China, and India can lead to shifts in pricing.
Silver prices are influenced by gold, often moving in tandem. The Gold/Silver ratio helps compare the relative values of these metals. Higher ratios may suggest silver is undervalued, while lower ratios might indicate gold is undervalued.
Silver And The Economy
Silver saw a pullback to $51.64 today, which is a notable drop. However, we must remember this comes after a massive 78.73% rally so far in 2025. This kind of volatility suggests that while the long-term trend has been strongly positive, a deeper correction is possible.
The Gold/Silver ratio has climbed to over 80, indicating that gold is currently outperforming silver. Looking back at data from the past decade, a ratio this high has often suggested silver is undervalued in the long term. In the immediate future, however, it signals silver’s relative weakness and a potential flight to the safer of the two precious metals.
All eyes are on the US Federal Reserve, especially with recent economic data showing that core inflation remains sticky. The latest September 2025 Consumer Price Index (CPI) report showed an inflation rate of 3.9%, which has reinforced the market’s expectation that the Fed will not be cutting interest rates soon. This strengthens the US Dollar and creates a significant headwind for silver prices.
On one hand, the ongoing green energy transition continues to boost industrial demand, with global solar panel installations in 2025 projected to grow by another 20% year-over-year according to recent industry reports. However, manufacturing data from China has been lukewarm, which tempers some of that industrial optimism. This creates a conflicting picture for silver’s fundamental value.
For us as derivative traders, this environment screams high implied volatility. Given the sharp run-up this year, which reminds us of the spike and subsequent collapse we saw back in 2011, traders should be cautious. We should consider strategies that profit from price swings, such as using options to define risk and manage leverage on futures contracts carefully in the coming weeks.
