Silver Bullion Hedge

silver is trading more as an industrial commmodity right now, but even then, the GS ratio is in silver's favor by a long way. just hang on to it and when XAG touches 20 hit it for another 100K. your dad is a wiser man than most will ever know.

If you really want to hedge the position you could just sell some silver futures. However, the PnL swings will be large and you have to make sure you have enough cash on hand to post margin on the hedge if necessary.

I just bought into SLV today... why you mad?

Silver is weird to hedge against because it isn't as prone to investor emotions as gold. I would hang on it like thatguy said...pay close attention to solar panels and see what happens.

A portfolio manager recently told me that the only real hedge is liquidity. Truer words have never been spoken. Keep unloading a fraction of that position should the volatility go against you and be willing to unload your entire position.

i am long cash and have a small long gamma position on VIX, that's it. sideways markets for a few months until europe hits the wall and that liquidity is gonna come in mighty handy.

Since silver is in some sense an inflation play (weak dollar), for a hedge I would do some sort of strong dollar play. Maybe Long USD Short AUD or Long USD Short EUR. Long USD Short AUD is a good option because AUD mimics the price of gold, so in a way you are short gold.

if u sell AUD or EUR vs Silver you are just long silver in AUD terms or EUR terms...may be slightly less volatile then Silver in USDs but is certainly not what i would call a hedge...its just a different trade.

the comments about liquidity and futures markets are right on, but if you have the liquidity to buy a fully offsetting position in the etf, you can post the margin.

Although I would hold silver and hedge out only the USD exposure personally. I like the industrial exposure.

barboon - hows that 100k in silver right now?