The Spot vs. Physical Gold/Silver Ratio

Updated 10/28/20 @ 7:20 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.

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 on 5/5/20 and has since declined to about 7.00.

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 UPDATE: 10/28/20 @ 7:20 PM EST

  • Spot Gold/Silver Ratio: 80.27
  • Physical Gold/Silver Ratio: 71.89
  • Spot Minus Physical Ratio: 8.37

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

Updated 10/28/20 @ 7:20 PM EST

Graph Start Date – April 6, 2020.

NOTE: The spot gold/silver ratio is higher than the actual 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 111%. It is now at close to the lowest premium since I started keeping track of the ratio – below 110% as of 10/14/20.


RECENT DEVELOPMENTS IN THE SPOT AND PHYSICAL GOLD/SILVER RATIOS

  • The difference between the spot and physical gold ratios reached a peak on 5/4/20 at 35.38 and has trended lower ever since.
  • This difference went below 26 on 5/26/20 but then got as high as 29 the next day.
  • On 5/29/20 the difference went back below 26 and then on Sunday, May 31 it went under 25.
  • On Monday morning 6/1/20 the difference fell below 24. On 6/10/20 it fell below 23. From that point, throughout June, the difference continued to decline. It fell below 20 on 6/30/30, below 19 on 7/5/20 and then below 18 on 7/8/20.
  • On the afternoon of 7/30/20 physical silver skyrocketed in price. This accounts for the huge increase in the spot/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 premium started declining again starting on 8/5/20 when dealers started coming in with 20-coin offers back in the high $700 range.
  • The premium has been on a clear decline since its spike peak in early August.
  • The percentage premium has been below 15% since 8/27/20.
  • The percentage premium has been below 10% since 10/13/20.

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