Original title: fund managers bet that silver is the next flashpoint! The settlement price of futures hit a four-year high on Monday and is expected to reach $25 to $30 in the future.

Silver futures hit their highest settlement price in nearly four years on Monday, boosted by a sharp rise in investment demand. Silver continues to catch up with gold, which is also a precious metal.

Adrian Ash, director of research at BullionVault, said: "the total value of silver traded every day is only 10% of that of gold, so hedge funds and other fund managers who want silver to catch up with gold's jump to record highs hope to make more money from silver.

Silver futures hit their highest settlement price in nearly four years on Monday, and September silver futures closed at $19.788 an ounce on Monday. This is the highest closing point for the most active futures contract since September 2016, according to Dow Jones market data.

Meanwhile, Monday

Spot silver

It set a 10-month high of $19.378. The gold August futures contract settled Monday at $1814.10 an ounce, close to $1820.60 on July 8, the highest level since September 2011.

The demand for silver surged

In the past few months alone, physical silver purchases through Silver ETF have reached an all-time high, said Peter Spina, president and chief executive of GoldSeek.com. "We have never seen such strong demand in such a short period of time in the history of silver."

According to a recent report by the International Trade Association Silver Association (silver Institute)

As of June 30, silver holdings of global silver exchange traded products (ETPs) reached "an all-time high of 925 million ounces, equivalent to about 14 months of silver supply". ETP grew by 196 million ounces in the first half of 2020, "easily surpassing" the highest annual growth of 149 million ounces set in 2009, the report said.

Among the reasons for the surge in interest in silver, Spiner points out that silver "has been largely ignored in the past few years, as many former silver buyers have turned to cryptocurrencies and more exciting assets." However, Mr Spina, president of SilverSeek.com, a provider of silver news and analysis, said the value of silver was "hard to ignore".

The ratio of gold to silver is too high, and the future adjustment is expected to support the silver price.

"the best indicator of value is the ratio of gold to silver," says Mr Spina. " He pointed out that the gold-to-silver ratio had soared to 130 per cent due to extreme market selling-meaning 130 ounces of silver was needed to buy an ounce of gold. The ratio is now back below 100, but it should be closer to 50, he said. "even if the gold-silver ratio falls to about 50, it is much higher than that found naturally, because the ratio of silver to gold is about 20," says Mr Spina. "

Even if the ratio falls from the current four-month low of 93 to 84 by the end of August, as long as gold can hold on to the level of $1800, it will bring the price of silver to $21.50, says Mr Adrian of BullionVault. If gold rises above its all-time high of $1921.18, silver could rise to $22.60.

According to Dow Jones market data, the most active gold futures have settled at $1891.90 an ounce since Aug. 22, 1984. On Sept. 6, 2011, gold prices hit an intraday high of $1921.18 an ounce.

Adrian pointed out that the price of silver plummeted to an 11-year low of US $11.641 in mid-March due to the epidemic, while gold remained near a six-year high in the same period. But silver rose 58 per cent in just 80 trading days, making its performance from March to July 2020 "among the top 4 per cent of all four months of growth over the past half century". Nevertheless, silver prices have exceeded current gains several times, such as 1974, 1979, 1982, 1987, 2010 and 2011, which are periods of extreme economic or financial tension, so he said: "when silver prices fluctuate, they can be very volatile."

"there have never been more individuals seeing important components of silver stability and diversification portfolios, with silver holdings on BullionVault up 26 per cent and gold holdings up 11 per cent so far this year," Adrian said.

The silver price of $100 an ounce is "not at all unreasonable in the next few years."

Silver will also rise as gold is now moving towards $2000 or more, Spina said. He said

His first goal for silver is to rise to $25 to $30 in the next few quarters, and the "uptrend" of silver is currently under way.

In the next few years, as gold prices break through $2000, Mr Spiner expects silver to "return to its inflation-adjusted high of $50" and is likely to rise further. Silver of $100 an ounce is not at all unreasonable expectations in the next few years, and the speed at which it is changing may shock many people. "

17:50 Beijing time

Spot silver

It is now trading at US $19.020, down 0.29%.