The gold silver ratio is a widely used metric in the commodity market. This is as the ratio refers to the strength of gold compared to silver or simply speaking of the outlook for the precious metal to perform in the future.
The formula ut is a simple equation that shows how many times gold is trading compared to the price of silver.
How is the gold/silver ratio calculated?
To know, the ratio of gold to silver, you need to divide the price of gold by the current price of silver and in case it is on the lower side, silver may be more than the precious gold of the yellow metal.
What is a good or good ratio of gold to silver?
The normal range of gold to silver is between 50 and 70, and if it is close to 80 levels, there is an indication to buy silver metal.
Current gold/silver ratio trend and what it shows
Currently, the gold/silver ratio is falling, indicating silver’s optimism and continued overperformance. Ajay Kedia- Director- Kedia Advisory mentions that if the silver rate of gold goes down then it will surpass silver.
And this comes as major banks around the world turn to lower rates and demand for silver amid the boom in the clean energy sector has been growing.
In addition, to increase the base of silver, China and India import silver in good amount. Another, important use was in the white metal solar panel area.
So given the strength shown by silver, Kedia sees silver hitting Rs 94,000- Rs 95,000 levels by the end of 2024. This is about 5 percent rise for the metal considering its closing price of Rs 90,630 per kg in the previous MCX session.
Interestingly, the white metal fell from a peak of 1,00,289 levels to Rs 90,630- down by around Rs 9,660 per kg or around 10 per cent.
