Silver Investment Demand and How it will Affect Silver Prices

As with the majority of commodities, silver prices are largely determined by supply and demand; it's been as simple as that for some time.

But a new factor is being introduced into the silver investing mix, and that is the demand for Silver Investment itself.

Understand the difference between supply and demand and investment demand. Supply and demand refers to the industrial part of the equation, while investment demand looks at silver in and of itself.

The two of course can't be completely separated, especially when thinking of the supply side, which deals with silver inventory, silver mining, and physical holding of silver by ETF funds.

It looks like silver investment demand will continue to rise in the years ahead, while at the same time silver investment inventory is very small in light of the growing demand.

For the very reason that available silver for investment is so small in relationship to the growing number of investors almost ensures it'll explode in price growth in the years ahead.

Take into account the inevitable growing industrial demand that large emerging markets like China and India represent, you have almost the perfect storm for all the right things happening for the metal.

So to finish, the two major elements related to the price movements of silver will be the usual supply and demand situation, which even if investment demand wasn't growing, would still be very positive.

Add the Silver Investment demand to it, and you see the great potential silver has for investors going forward.