The Spot vs. Physical Gold/Silver Ratio

Updated 1/26/21 @ 9:30 PM EST

Graph Start Date – April 6, 2020.

Rather than simply dividing the spot prices of gold and silver, my ratio is based on the physical gold and physical silver prices from Ebay – thus it is a “physical” ratio.

The orange line is the spot ratio, blue is the physical ratio and grey is the difference between the two. The red line is the 90-period moving average of the differential between spot and physical.

Notice that the these two ratios have been converging slowly. This is easiest to see in the grey line. It hit a high of over 35.00 on 5/5/20 and has since declined to about 6.00.

What this means is that there is a very low physical premium over spot – and that means that the system has not collapsed … yet.


LAST GRAPH UPDATE: 1/26/21 @ 9:30 PM EST

  • Spot Gold/Silver Ratio: 72.96
  • Physical Gold/Silver Ratio: 65.91
  • Spot Minus Physical Ratio: 7.04

The following chart shows the percentage premium of the spot vs. physical gold/silver ratio.

Updated 1/26/20 @ 9:30 PM EST

Graph Start Date – April 6, 2020.

NOTE: The spot gold/silver ratio is higher than the physical gold/silver ratio – but the trend appeared to be moving downward until silver and gold started spiking toward the end of July/early August. After a huge increase in physical silver premiums in early August (which spiked the percentage premium to all times highs near 150%), the premium has settled down below 108%. It is now at close to the lowest premium since I started keeping track of the ratio. See recent developments below for more details.


RECENT DEVELOPMENTS IN THE SPOT AND PHYSICAL GOLD/SILVER RATIOS

  • UPDATE 1/26/21: The percentage premium moved above 11% early in the day but then fell back below by evening. It is now at 10.69%.
  • UPDATE 1/24/21: The percentage premium moved above 10%. This is the highest premium since 11/30/20. Could this be an early sign of tightness in the precious metals markets?
  • UPDATE 1/20/21: The percentage premium has increased almost 3% points in the last few days. It now stands at over 9.00%. Of course, this is nothing even close to the premium back in June 2020 of almost 40%.
  • UPDATE 1/18/21: The percentage premium declined to 6.69% in the afternoon – the absolute lowest since my records started. By later in the evening and into 1/19/21 it had advanced above 7%.
  • UPDATE 1/15/21: The percentage premium moved back above 8% today.
  • UPDATE 1/12/21: The percentage premium moved above 9% in the morning and then in the evening declined to the lowest level since I have been keeping records: 7.11%. It remains in the 7% range on 1/14/21.
  • On 1/4/21 the percentage premium went under 8% but it popped back above on 1/7/21.
  • On 11/25/20 the percentage premium dipped under 10% again. The last time this happened was in early to mid October 2020.
  • The percentage premium crept up to a high of 12.11% on 10/29/20 but has since declined back into the 10% range and has remained there (for the most part) since 11/5/20.
  • The percentage premium went below 10% on 10/13/20 and remained there until 10/25/20.
  • The percentage premium has been below 15% since 8/27/20.
  • The premium has been on a clear decline since its spike peak in early August.
  • The premium started declining again starting on 8/5/20 when dealers started coming in with 20-coin offers back in the high $700 range.
  • On the afternoon of 7/30/20 physical silver skyrocketed in price. This accounts for the huge increase in the spot vs. physical gold/silver ratio. This huge increase didn’t last as DBS Coin came in with quantities of silver lots at a lower price.
  • The percentage premium hit a June high of 38.15% on 6/3/20. From there it trended lower. It ended June at 24.74%.
  • The percentage premium of the spot vs. physical gold/silver ratio hit a reached a peak on 5/4/20 at 44.16% and has trended lower ever since.

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