Silver's Historic Breakout Is Coming—Here's How We'll Profit
'Crisis Investing' Issue 7 / July 2025 – Vol 2
Dear Reader,
Silver—the poor man’s gold—is back in the spotlight. It’s posted an impressive double-digit gain so far this year, pushing toward US$40 per ounce and getting investors excited again.
Of course, if you’ve been with us for a while, you probably know this is classic silver behavior in a precious metals bull market—starts slow, lags gold at first, then plays catch-up with explosive force that often leaves gold in the dust.
I wrote about this pattern last July, highlighting how silver tends to outperform gold during bull market phases. If you haven't read that piece recently, I'd encourage you to give it another look.
Now, silver hasn’t blasted past gold just yet—if it had, we’d already be late to the party.
But the action is building—and you can already see it gradually spilling into silver stocks. If you look at the chart below, silver’s up about 31% over the past year, but silver miners—as tracked by the Global X Silver Miners ETF (SIL)—have only recently started to pull ahead at 43%.
As you can see, up until around April 2025, silver stocks were going toe-to-toe with the metal itself—like they were too nervous to break out, afraid of getting the whac-a-mole treatment from the market.
Not anymore. The gap between silver and the stocks is widening.
But here’s the thing. As impressive as that 43% return might sound, you’d normally expect silver stocks to do much better than the metal itself—thanks to leverage.
That’s because when metal prices rise, miner profit margins expand fast. A small move in the underlying commodity can translate into much bigger gains for the companies pulling it out of the ground.
So yeah, we’re not quite at the stage where silver stocks are delivering 2x, 3x, or more of silver’s gains. Yet. And that’s exactly where the opportunity lies.
But let’s get back to the metal itself for a moment.
What’s interesting is that even after its recent run that’s taken it close to US$40, the poor man’s gold is still sitting more than 20% below its 2011 high of around US$58. Just take a look at the chart below.
Remember, gold took out its 2011 high back in early 2020, then smashed through that level again in mid-2023. It has never looked back since—recently hitting over US$3,400 per ounce, a new all-time high.
So silver still has a lot of room to run. And again, if you look historically at how these cycles play out, silver eventually doesn't just catch up to gold's performance—it often crushes it.
Now, this “still below 2011” situation is even more extreme when it comes to silver stocks. Just look at the chart below: despite gaining over 40% in the past year, SIL is still sitting about 44% below its 2011 peak.
Sure, silver’s rally helped push silver stocks back to their 2020 peak—and flirt with 2016 levels. But they’re still only halfway to their 2011 all-time high.
So, to recap:
Silver is heating up—yet still sits well below its all-time high.
Silver miners are finally starting to show life, but haven’t yet delivered the kind of outperformance you’d normally expect in a bull market.
Both the metal and the stocks have serious room to run—and history suggests silver eventually goes parabolic.
That’s exactly the setup we’re looking to take advantage of this month with a new and exciting silver pick.
Happy investing!
Lau Vegys