Silver Futures

Market

Silver is one of the most popular and useful metals in the world. The majority of the commodity is mined in Latin America and consumption is spread all over the world. The global influence of silver futures makes the contract a large-scale financial commodity.

History

The first trade date for silver futures was July 5, 1933.

Silver is a soft, ductile and malleable metal. Its thermal and electrical conductivity is the highest of all known metals. Much like copper futures, as a commodity, it is used in areas such as electronics, photography and as antiseptics, but most notably as a form of money and jewelry.

The first evidence of its use as currency dates back to around 700 B.C.E., in what is now Turkey. Silver has adorned tombs from Chaldea to China, and was one of the prime movers of European history after the discovery of the New World.

The British pound (sterling) derives its name directly from the fact that the currency was once considered to be worth one pound of sterling silver. More than 14 languages use synonymous terms for silver and money. The U.S. dollar prior to the Civil War was also backed by silver.

Facts

Silver is typically extracted from ore, usually of copper, gold and zinc. While silver futures are traded less commonly than gold futures, the market has played a significant role in affecting currencies and consistently moves in tandem with the rest of the metal futures markets.

Trading

Silver futures are traded on the following exchanges:

  • Commodities Exchange (COMEX), a member of the CME Group. On this exchange, the standard silver futures contract represents 5,000 troy ounces
  • London Metal Exchange (LME): The LME offers silver forwards curve data to any investor interested in signing up. Investors will be able to see one-week forward curves as well as 1, 2, 3, 6, 9, 12, 24, and 36 months forward.
  • Multi-Commodity Exchange (MCX): As of 2011, the MCX was ranked number one for silver trading as it offers two different contracts. The standard silver futures represent 30 kg and trade in March, May, July, September and December. The MCX is based in India.

Silver futures follow the price of gold. As gold rises and falls, so do silver futures.Silver futures represent another method that investors use for hedging currency risk through precious metals as the dollar weakens.

You can learn more about Metals futures by downloading our guide, Free Fundamentals of Trading Metals Futures.

 

Contract Specifications  

Contract SymbolContract UnitPrice Quotation
GSI5,000 troy ouncedollars per ounce
Trading ExchangeTrading HoursTick Value
CME COMEX18:00 - 17:15$0.005/lb = $12.50

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This material has been prepared by a sales or trading employee or agent of RJO Futures and is, or is in the nature of, a solicitation. This material is not a research report prepared by RJO Futures Research Department. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions, and agree that you are not, and will not, rely solely on this communication in making trading decisions.