World silver prices continued to rise. During trading on Monday, February 1, the cost of an ounce broke through the $ 30 mark and approached a multi-year record, Bloomberg reports. The growth also affected mining companies, for example, China Silver Group rose 45 percent on the Hong Kong stock exchange, while Australia’s Silver Mines rose 49 percent.
The growth could have happened due to purchases of private investors, writes Reuters, who switched to precious metals. The rise in prices began at the end of January 2021 after a message appeared in the community of private investors on Reddit calling to invest in this metal.
Earlier, on a wave of speculative buying, shares of the American video game retailer GameStop, the AMC cinema chain, as well as Nokia, BlackBerry and other companies that were called undervalued on Reddit rose sharply. Millions of small individual investors united in the WallStreetBets group and began to actively buy shares, which have fallen in price. As a result, in a couple of weeks the company’s shares rose more than tenfold, and a number of funds were forced to close their short positions (“shorts”) with billions of dollars in losses.
However, it is still unlikely that individual traders will be able to achieve the same effect in the silver market as in the stock market. “It’s one thing to short-squeeze in the stock market, and quite another in the commodities market, where there are physical reserves three times the daily trading volume of futures,” said research director at brokerage BullionVault. In his opinion, the silver market will not be able to hold the attention of Reddit users for long.