Why Investing in Gold and Silver Might Be a Safe Choice for 2025

Amidst trade wars, geopolitical risks, and dovish central banks at the forefront of investors’ minds, Global X explores why investors may want to consider gold and silver in the context of the current environment.

Gold has historically served as a store of value during market turbulence. Its physical nature can offer a sense of stability when risk sentiment turns.

That safe haven role is in focus again in early 2025, as investors respond to renewed geopolitical tensions and shifting U.S. policy under President Donald Trump. Gold has hit fresh record highs, extending strong gains from last year.

While not yet directly targeted by tariffs, precious metals could be caught in broader trade actions¹. That risk has spurred a transatlantic shift in holdings, with more gold moving from London to New York as investors seek stability.

Concern over U.S. import tariffs have driven Comex gold futures prices above spot prices, creating a lucrative arbitrage opportunity, resulting in gold bullion inventories reaching record highs:

To take advantage of the high premium gold futures have been experiencing, financial institutions have been flying gold from Asia and the Middle East to North America. Traditionally, gold bullion is transported eastwards from the West to meet demand in China and India, the world’s two largest consumers.

One major bank predicts that gold’s rally may have further to run: Goldman Sachs has updated its year-end gold price forecast to $3,300 an ounce.

While both gold and silver are classified as precious metals, silver stands out for its industrial utility — which accounts for roughly 58%³ of annual demand. In contrast, only about 11% of gold demand is industrial, with the rest tied to jewelry, bullion, and central banks.

As a result, silver prices are influenced by both safe-haven demand and trends in industrial activity, giving it a more diversified demand profile than gold.

Ongoing geopolitical and macroeconomic risks have supported demand for safe-haven assets. A spike in silver prices was further driven by short covering in the futures market amid concerns over President Trump’s tariff agenda.

Another valuation used by investors and traders to assess the relative value of the two precious metals and help guide buy or sell decisions is the gold-to-silver ratio, which measures the number of ounces of silver that equals the price of one ounce of gold.

Historically, the ratio has averaged approximately 65 over the last 30 years.⁴ With the ratio currently near 90, it may signal that silver is undervalued relative to gold.

“There is a positive correlation between the price of gold and silver, as both are classified as precious metals. Silver is often referred to as the poor man’s gold,” Global X’s Thackray adds.

“The gold to silver ratio can only be stretched so far, before investors take an increasing interest in silver.”

The silver market is forecast to record another significant deficit, according to data from the industry body The Silver Institute:

The Silver Institute says that silver industrial demand will remain the key driver of the supply/demand backdrop, with volumes projected to hit a new record high this year.

The silver industry body sees increased industrial usage gains coming from “Green Economy” applications (such as solar panels) and consumer electronics.

Investors have several options for gaining exposure to gold and silver — from buying physical bullion to trading futures.

Another approach is through mining stocks or ETFs, which are generally more liquid and can offer leveraged exposure to precious metals prices. Miners may benefit from rising prices by expanding production and increasing margins, unlike physical holdings.

Mining stocks can also add diversification to portfolios, particularly in times of geopolitical uncertainty. ETFs may help mitigate single-stock risk by holding a broad basket of miners or even direct exposure to the metals themselves — all under one management fee.

In a climate of trade tensions and geopolitical uncertainty, gold and silver remain relevant portfolio tools. Gold offers a traditional hedge in volatile markets, while silver’s mix of industrial and precious metal demand adds diversification. With silver trading at a discount to gold and supply lagging demand in 2025, investor interest may continue to grow.

Whether through bullion, futures, or ETFs, investors have flexible options to gain exposure and position for resilience in a shifting global environment.

HUG – Global X Gold ETF
HUZ – Global X Silver ETF
HGY – Global X Gold Yield ETF
GLDX – Global X Gold Producers Index ETF
GLCC – Global X Gold Producer Equity Covered Call ETF

SOURCES

¹ Source: Bloomberg News (February 27, 2025), What’s Driving the Gold Rush From London to New York?

² Source: Bloomberg News (March 14, 2025), Gold Breaks Through $3,000 as Trump Turbocharges Record Rally

³ Industrial demand is calculated as a percentage of total demand from the Silver Institute’s World Silver Survey 2024.

⁴ Source: Global X ETFs US (June 9, 2022), Silver, Explained

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Published April 3, 2025.