Gold, either through mining stocks such as the Market Vectors Gold Miners ETF (NYSE:GDX) or in its physical form through the ETFS Physical Swiss Gold Shares (Nasdaq:SGOL), has become immensely popular with investors. Gold's status as an inflation fighter and safe haven in times of trouble is in focus as investors continue to pump money into the asset class. However, many commodities gurus have recently been pointing to gold's twin as the money metal.

IN PICTURES: 5 Investing Statements That Make You Sound Stupid

Jim Rogers on Silver
Outspoken commodities bull, Jim Rogers has recently been taking a shine to silver. While, he isn't abandoning his gold positions just yet, he said that depressed metals such as silver and palladium represent some of the best buys right now. Silver is currently trading at nearly 60-70% below its all time highs. Silver reached its high of $50.35 in 1980.

Analysts predict that silver prices could reach $21 to $22 by the end of the year. From an investment point of view, silver has performed pretty well during the past 20 years. Poor man's gold has risen in price from a low of around $3.50 in the early '90s to the current highs of around $18. This has given investors an annual return of about 9%.

Aside from being a possible value play in relation to gold, silver has a lot going for it in the industrial world. The metal has several uses in automotive sector and electronics manufacturing. Silver may get a boost from new uses in renewable energy. New technologies in solar cells and silver-oxide smart grid batteries could use demand for the mineral skyrocket. Currently accounting for 70% of the world's total industrial use, consumption in China is on the rise.

Small Silver Stocks
Both the iShares Silver Trust (NYSE:SLV) and ETFS Physical Silver Shares (Nasdaq:SIVR) represent physical holdings of bullion and are directly tied to the price of the underlying silver bars. They make perfect additions to a portfolio for investors wanting to profit from the price of silver. However, additional gains can be had if investors place their bets with the miners of such metals. The Global X Silver Miners ETF (NYSE:SIL) recently debuted and follows a basket of silver miners. Here are some of the more interesting stories from the fund.

As the second largest primary silver producer in the world, Pan American Silver (Nasdaq:PAAS) has managed to increase its production nearly 104% since 2004. The company operates eight silver mines and four new early stage projects in politically friendly Peru, Mexico and Argentina.

Location of projects is just as important as number. Just ask investors in Crystallex International (NYSE:KRY) on what can happen. Pan American has nearly 234 million ounces of proven reserves and approximately 940 million ounces in inferred supply. Pan American trades at a forward P/E of 18.

Silvercorp Metals (NYSE:SVM) is an interesting play on the increasing demand from China. The miner operates four projects in Ying province of China. The company has one of the lowest costs of production, zero long-term debt, nearly $95 million in cash on its balance sheet and pays a 1.2% dividend.

Producing silver since 1891, Hecla Mining (NYSE:HL) is one of the oldest miners around. The company is also the largest producer of silver based in the United States. Thorough its mines in 2009, Hecla produced 10.9 million ounces of silver at an average total cash cost of $1.91 per ounce. Shares of the miner trade for a forward P/E of 15.

The Bottom Line
While, gold still gets all the attention, silver could be a great value play. Trading at a 60% discount to its all time highs, the metal could see hefty price gains as industrial demand keeps increasing. Either through physical bullion or through silver miners, investors can profit on the metals rise. The previous picks are just of the few out in the sector. (Learn about strategies to trading silver in Trading The Gold-Silver Ratio.)

Use the Investopedia Stock Simulator to trade the stocks mentioned in this stock analysis, risk free!

Related Articles
  1. Investing News

    Latest Labor Numbers: Good News for the Market?

    Some economic numbers are indicating that the labor market is outperforming the stock market. Should investors be bullish?
  2. Investing News

    Stocks with Big Dividend Yields: 'It's a Trap!'

    Should you seek high yielding-dividend stocks in the current investment environment?
  3. Investing News

    Should You Be Betting with Buffett Right Now?

    Following Warren Buffett's stock picks has historically been a good strategy. Is considering his biggest holdings in 2016 a good idea?
  4. Products and Investments

    Cash vs. Stocks: How to Decide Which is Best

    Is it better to keep your money in cash or is a down market a good time to buy stocks at a lower cost?
  5. Investing News

    Who Does Cheap Oil Benefit? See This Stock (DG)

    Cheap oil won't benefit most companies, but this retailer might buck that trend.
  6. Investing

    How to Ballast a Portfolio with Bonds

    If January and early February performance is any guide, there’s a new normal in financial markets today: Heightened volatility.
  7. Stock Analysis

    Performance Review: Emerging Markets Equities in 2015

    Find out why emerging markets struggled in 2015 and why a half-decade long trend of poor returns is proving optimistic growth investors wrong.
  8. Investing News

    Today's Sell-off: Are We in a Margin Liquidation?

    If we're in market liquidation, is it good news or bad news? That party depends on your timeframe.
  9. Investing News

    Bank Stocks: Time to Buy or Avoid? (WFC, JPM, C)

    Bank stocks have been pounded. Is this the right time to buy or should they be avoided?
  10. Stock Analysis

    Why the Bullish Are Turning Bearish

    Banks are reducing their targets for the S&P 500 for 2016. Here's why.
  1. Should mutual funds be subject to more regulation?

    Mutual funds, when compared to other types of pooled investments such as hedge funds, have very strict regulations. In fact, ... Read Full Answer >>
  2. Do ETFs pay capital gains?

    Exchange-traded funds (ETFs) can generate capital gains that are transferred to shareholders, typically once a year, triggering ... Read Full Answer >>
  3. How do real estate hedge funds work?

    A hedge fund is a type of investment vehicle and business structure that aggregates capital from multiple investors and invests ... Read Full Answer >>
  4. Are Vanguard ETFs commission-free?

    While some Vanguard exchange-traded funds (ETFs) are available commission-free from third-party brokers, a large portion ... Read Full Answer >>
  5. Do Vanguard ETFs require a minimum investment?

    Vanguard completely waives any U.S. dollar minimum amounts to buy its exchange-traded funds (ETFs), and the minimum ETF investment ... Read Full Answer >>
  6. Can mutual fund expense ratios be negative?

    Mutual fund expense ratios cannot be negative. An expense ratio is the sum total of all fees charged by an asset management ... Read Full Answer >>
Trading Center