Gold/Silver ratio

The Gold/Silver Ratio (GSR) is the number of silver ounces needed to buy one ounce of gold. Historically, this ratio stood around 15:1 (gold was worth 15 times silver). The Roman Empire set a legal ratio of 12:1. In the 21st century, the ratio oscillates between 60 and 120, with an average around 75–80.

A high ratio (> 80) signals that silver is relatively undervalued compared to gold, and may constitute a buy signal for silver. A low ratio (< 60) suggests silver is relatively overvalued. In March 2020, the GSR briefly reached 125, a historical record — silver then rebounded +140% over 18 months.

Swiss investors use the GSR to optimize their precious metals allocation. Strategy: when the ratio is > 85, overweight silver; when it drops below 65, rebalance towards gold. This 'mean reversion' approach has historically outperformed simple buy-and-hold of either metal alone.