Silver has quietly climbed to its proudest heights in over 13 years, recently breaking through $35.80/oz as of June 5, 2025 — marking a blistering 24% year-to-date gain. With analysts and Reddit forums buzzing about a potential “Silver Squeeze 2.0,” many investors are now asking: Is it time to jump in?
A Look Back: History, Deficits, and Squeezes
Silver’s volatility is legendary. The 1980 “Silver Thursday” debacle, when the Hunt brothers sent prices soaring over 700% before markets crashed, is still a lesson in caution. Fast-forward to 2021, and a meme-fueled rally fizzled after fundamentals failed to support the hype. But today feels different.
According to the Silver Institute, 2025 marks the fifth consecutive year of a structural supply deficit, with demand outstripping production. On top of that, the market is witnessing a ballooning imbalance: paper contracts (ETFs, futures) now represent over 400 oz per ounce of physical silver — setting the stage for a possible short squeeze.
What’s Fueling the Rally
Industrial Demand: Silver’s indispensable in solar panels, 5G, and EVs. The Silver Institute reported a 12% rise in silver used in solar manufacturing in 2023.
Safe-Haven Appeal: With inflation lingering and global unrest on the rise, investors are flocking to precious metals. Nitesh Shah from WisdomTree noted it was “supporting its case… as industrial demand [improves] at a later stage.”
Tight Supply: Since most silver is a byproduct, rising prices don’t necessarily translate to increased mining. COMEX inventories remain low.
Gold-Silver Ratio: The ratio has slid from around 105 in April to near 94, still significantly above the long-term average of ~68 — suggesting silver may be undervalued and primed for a catch-up.
Quotes on the Outlook
Kitco’s Jeremy Szafron reported that the “coordinated grassroots movement” around silver is fueling optimism for a breakout. Meanwhile Peter Krauth of SilverStockInvestor told Kitco News: “We could see silver hit $40 this year and break $50 in 2026.”
Economistic forecasts are bullish too — one note said “silver more than erased gains at $30.50 ahead of Fed,” and UBS projects an average price of $36–38 in 2025, rising as global liquidity finds a home.
Risks Investors Should Know
Silver’s thrill ride comes with trauma: rapid spikes can reverse on weak demand or stronger U.S. dollars. Industrial demand concerns — particularly if economic growth stalls — could drag prices lower. Goldman Sachs cautions that gold remains in favor and may continue to outperform due to central bank buying.
How You Can Play It
Physical Silver: Bullion and coins offer direct exposure but require storage, insurance, and sometimes liquidity trade-offs.
ETFs: Funds like the iShares Silver Trust (SLV), Aberdeen Standard Physical Silver Shares ETF (SIVR), and Invesco DB Silver Fund (DBS) provide simple access to silver. As of June 2025, SLV has returned approximately +22.4% year-to-date, while SIVR has returned +21.7%. These ETFs typically carry expense ratios around 0.30%–0.50%. However, they track paper silver, meaning they don’t influence physical supply tightness.
Mining Stocks: Companies like MAG Silver (MAG), First Majestic Silver (AG), and Pan American Silver (PAAS) offer leveraged returns during bull runs. MAG’s stock jumped 5.9% following its inaugural dividend announcement. Meanwhile, AG is up 28% YTD, and PAAS has gained 19% in 2025 so far. These plays can amplify gains — but come with higher volatility and operational risks.
Bottom Line
Silver in 2025 is riding real momentum — a structural deficit, surging industrial needs, and growing safe-haven interest. With old-school squeezes in the rearview and fresh catalysts paved by supply constraints and paper market mismatches, this could be a rare moment to consider a position.
That said, silver’s temperament is tempestuous — large price swings are part of the game. If you’re ready for volatility and want to diversify beyond gold, silver looks primed — but approach it with modest allocations in a broader portfolio mix.
Marc has been involved in the Stock Market Media Industry for the last +5 years. After obtaining a college degree in engineering in France, he moved to Canada, where he created Money,eh?, a personal finance website.
