Many people look first at the price when it comes to precious metals. Has gold risen today? Has silver fallen? Did I buy at the right time? Should I have waited? Should I have sold earlier?
These questions are understandable. But from my 40 years of experience in the financial and commodities sector, I know that anyone who focuses solely on the daily price when building wealth strategically often overlooks the more important factors. Building, optimising and protecting wealth is not only about short-term price appreciation. It is also about security, liquidity, ownership, tax structure, purchasing advantages, quantity, strategy and long-term objectives.
Especially with physical precious metals, the key question is not: “What is the price doing today?”
A better question is: “How much tangible wealth have I built up over the long term and how can I strategically increase that amount?”
THE BIGGEST MISTAKE: SHORT-TERM EXPECTATIONS FOR LONG-TERM TANGIBLE ASSETS
Most disappointments do not arise because an investment is poor. They arise because expectations do not match the investor’s actual objectives. Prices are determined by the market. Every investor, however, is responsible for their own expectations and goals.
Anyone who buys physical precious metals and expects the price to rise continuously from the very next day will sooner or later be disappointed. Markets do not move in straight lines. Over the past 15 years, gold, silver and the gold-silver ratio have repeatedly experienced substantial moves both higher and lower. Historical 15-year charts show very clearly that corrections are normal and are not a flaw in the market.
It is therefore unrealistic to assume that you will always buy at the best possible price and later sell at the perfect price. After an event, everyone knows what would have been better. Beforehand, nobody knows for certain. No analyst, market commentator or expert has a crystal ball. Forecasts can provide guidance, but they are never a guarantee. Even ambitious silver scenarios, such as those discussed by many analysts around the world, are possible outcomes rather than certain promises.
THE DIFFERENCE BETWEEN SPECULATION AND A LONG-TERM STRATEGY
A price-focused, short-term investor is only satisfied when prices rise. They buy, watch the current price and expect their decision to be validated as quickly as possible. If the price falls, uncertainty sets in. Uncertainty turns into concern. Concern can turn into fear. And fear has never been a good adviser.
A long-term investor thinks differently. They understand: If I buy regularly and the price falls, I receive more metal for the same amount of money. More grams. More ounces. More substance. More tangible wealth.
For them, a price pullback is not automatically a loss, but often a buying opportunity. Anyone who buys precious metals regularly on a monthly, biweekly or weekly basis benefits from the so-called cost averaging effect. At higher prices, a smaller quantity is purchased. At lower prices, a larger quantity is purchased. Over time, this creates an average purchase price that does not depend on a single entry point. Price fluctuations are not eliminated, but can be used strategically to the investor’s advantage.
THE QUANTITY REMAINS, EVEN WHEN THE PRICE FLUCTUATES
A simple thought can help put price corrections into perspective: If you own 1, 10 or 100 kg of precious metal, you still own 1, 10 or 100 kg after a short-term price correction. The quantity has not changed.
Of course, the current market value changes. But the physical ownership remains. This is precisely why long-term investors should not focus only on the current price, but also on the amount they have built up over time.
Strategic wealth accumulation is not about being right every day. It is about systematically building larger quantities of tangible assets over many years.
PHYSICAL PRECIOUS METALS: NO ISSUER, REAL OWNERSHIP AND HIGH LIQUIDITY
Physical precious metals are fundamentally different from many paper assets. Behind a share stands a company. Behind a bond stands a debtor. Behind a certificate stands an issuer. Physical gold and silver, by contrast, are not promises of payment from an issuer, but real tangible assets with intrinsic value.
This does not mean that precious metals are risk-free. Prices fluctuate. But physical precious metals do not carry traditional issuer risk. They are no one else’s liability. That is one of their key advantages when it comes to protecting wealth.
At the same time, precious metals offer a high degree of liquidity. Gold and silver are recognised, tradable and valued worldwide. Pricing is transparent, the market is international and demand is global.
WHY PRICE ALONE IS NOT DECISIVE IN THE ELEMENTUM STRATEGY
The long-term objective of the Elementum strategy goes far beyond simply hoping for rising precious metal prices. The real goal is more strategic: To increase the amount of precious metals owned over the long term, both with and without additional personal investment.
That is why the daily price matters, but it is not the only decisive factor. Often far more important is the relationship between gold and silver, known as the gold-silver ratio or GSR. The GSR shows how many ounces of silver are required to buy one ounce of gold. It is calculated by dividing the gold price by the silver price.
When the GSR is very high, silver is historically relatively inexpensive compared with gold. When the GSR falls significantly, silver has gained ground relative to gold. This is where strategic opportunities can arise.
The Elementum philosophy is also based on this principle: Selecting undervalued precious metals, using the gold-silver ratio, applying the cost averaging method, benefiting from lower fees, investment discounts, family and group discounts, employer-provided benefits and loyalty bonuses should all work together to help investors build their precious metal holdings over the long term.
SILVER AS A STRATEGIC BUILDING BLOCK FOR WEALTH PROTECTION AND WEALTH ACCUMULATION
From the perspective of many internationally recognised analysts, silver is one of the most interesting precious metals because it combines two worlds: It is a monetary metal and at the same time a strategically important industrial commodity with strong demand.
A look at production data illustrates this point. According to the USGS, global mine production in 2025 was around 3,300 tonnes of gold and around 26,000 tonnes of silver. That means roughly 7.9 times as much silver as gold was mined.
This does not automatically mean that silver “must” be only 8 times cheaper than gold. Prices are determined by many factors, including existing inventories, investment demand, industrial demand, recycling, market sentiment, central bank activity and liquidity. But the comparison does show that when the GSR is significantly above the production ratio, silver deserves a closer strategic look.
In addition, silver is required in many future-oriented industries, including electronics, photovoltaics, vehicle electrification, power grids, water treatment, medicine and numerous industrial applications. The Silver Institute reported that industrial silver demand reached a new record of 680.5 million ounces in 2024 and that the global silver market once again recorded a structural deficit.
Although the frequently cited figure of “more than 70% industrial consumption” can vary depending on how demand is defined, the underlying point remains valid: Silver today is far more than a pure investment metal. A substantial share of demand is industrial, structural and technology-driven. The Silver Institute puts total silver demand in 2024 at 1.16 billion ounces, meaning industrial demand of 680.5 million ounces accounted for around 59%.
THE 15-YEAR AVERAGE: GUIDANCE, NOT A GUARANTEE
The 15-year average is important for investors because it smooths out short-term extremes and helps prevent every correction from being viewed emotionally.
For the gold-silver ratio, Elementum’s current assessment places the long-term average over the past 30 years at around 65. At the same time, we want to emphasise that such threshold levels are not laws of nature, but points of reference.
That is precisely the point: An average does not replace a strategy. But it can help investors assess extreme situations more effectively.
If the GSR, for example, stands at 90, 95 or above 100, there are strong indications that silver is relatively inexpensive compared with gold. If the GSR later falls to 60, silver has significantly caught up relative to gold. This can create strategic switching opportunities.
SWITCH-GO: INCREASING PRECIOUS METAL HOLDINGS THROUGH CHANGES IN THE RATIO
A simple example illustrates the potential of the GSR.
Assume the GSR stands at 90. In that case, one ounce of gold is equivalent in value to 90 ounces of silver. An investor buying silver at this stage is buying a metal that is relatively inexpensive compared with gold.
If the GSR later falls to 60, those 90 ounces of silver are suddenly equivalent to 1.5 ounces of gold. Without investing additional money, a strategic switch from silver into gold can therefore increase the amount of gold owned, before taking into account costs, fees, bid-ask spreads and tax considerations.
If the gold-silver ratio falls from 100 to 60, the effect is even stronger: 100 ounces of silver would then be mathematically equivalent to around 1.67 ounces of gold. Of course, the strategy can also work in reverse. In certain market phases, switching from gold back into silver at a later stage can increase the amount of silver owned further.
This is where one of the key strategic advantages lies. It is not only about whether the silver price rises or falls today. It is about how silver performs relative to gold. Many Elementum clients were able to apply this principle very successfully at the beginning of the year through SWITCH-GO: Silver was accumulated when GSR levels were high and partially switched into gold after the ratio had fallen significantly. The objective: More precious metal holdings without investing more money.
It remains important to remember: A ratio strategy is not automatic. It requires discipline, patience and clear rules. Fees, storage costs, tax considerations and personal objectives must all be taken into account. Over the long term, however, this strategy can make a meaningful difference.
PROFIT IS MADE IN THE PURCHASE
An old business saying goes: Profit is made in the purchase.
The same applies to the strategic accumulation of precious metals. Those who benefit from better purchasing conditions receive more precious metal for the same amount of capital. Purchasing advantages are therefore not a side issue. They are a strategic component.
At Elementum, several building blocks work together: 7 investment discounts, family discounts, group discounts, lower fees, the cost averaging method, the GSR strategy, employer-provided benefits and strategic switching opportunities through SWITCH-GO. The objective is to offset the quantity of precious metals reduced by fees over the long term and, beyond that, to build additional holdings.
Fees are real. They should therefore not be ignored. But the better question is: Which strategy can help me compensate for these fees over the long term and increase my net holdings of precious metals?
EMPLOYER-PROVIDED BENEFITS: ADDITIONAL ACCUMULATION WITHOUT ADDITIONAL PERSONAL CAPITAL
Another interesting component can be employer-provided benefits. If employers offer their employees benefits in kind, this can allow additional precious metal holdings to be built without the client having to contribute the same amount from their own net income.
This is particularly interesting from a strategic perspective because it creates an additional inflow. Month after month, more tangible assets can be accumulated. Tax and legal requirements must of course be assessed individually. In Germany, benefits in kind and non-cash benefits are regulated, among other provisions, under Section 8 of the German Income Tax Act (EStG).
TAX ADVANTAGES: AFTER 1 YEAR, THE DIFFERENCE CAN BE DECISIVE
An important advantage of physical precious metals is their tax treatment in private disposal transactions. Under Section 23 EStG, disposals of other assets are generally relevant for tax purposes if no more than 1 year has passed between acquisition and disposal.
In practical terms, this means that gains on physical precious metals can be tax-free for private investors once the 1-year holding period has expired. This can apply not only to price appreciation, but also to the increase in value of any additional quantity accumulated, provided the relevant tax requirements are met.
The same principle applies here: This is not individual tax advice. But it shows why long-term thinking is so important when it comes to precious metals. Short-term trading can mean giving up strategic advantages. Long-term planning can combine price, quantity, tax structure and wealth protection more effectively.
ADVANTAGES OF STORAGE IN SWITZERLAND
Another important part of the strategy is secure storage. Elementum International AG specialises in the storage of physical precious metals in Switzerland. According to the company, it conducts storage activities only. Clients remain the legal and beneficial owners of their assets and stored holdings do not form part of the storage company’s insolvency estate in the event of insolvency.
The high-security storage facility in the St Gotthard massif is particularly noteworthy. The facility has the status of an open customs warehouse. Especially in the case of silver, this means that any applicable VAT only becomes payable to customs when the metal is withdrawn by the client.
Further advantages include high security standards, modern surveillance, strict access controls, insurance coverage, political and economic stability, discretion and the ability to trade precious metals within the customs warehouse without physically moving them.
In addition, clients’ stored holdings are audited annually by an independent auditing firm.
ADVANTAGES FOR THE WHOLE FAMILY
Strategic wealth accumulation does not end with one individual. It can become a family treasure.
Physical precious metals are particularly well suited as a long-term component for families because they are easy to understand, divisible, storable and transferable across generations. Children and grandchildren can learn what real ownership means. Parents can not only build wealth, but also structure it. Families can combine purchasing advantages, family discounts and long-term planning.
The Elementum philosophy describes this intergenerational family treasure as a long-term objective: Financial security, independence, freedom and prosperity for today and for future generations.
For me, this is one of the most important ideas: It is not only about the next price gain. It is about building real assets that endure and can be passed on.
PRICE DECLINES ARE UNCOMFORTABLE, BUT OFTEN STRATEGICALLY VALUABLE
Of course, a price decline does not feel good. Nobody likes to see the current value of an investment fall in the short term. But this is exactly where short-term speculation and long-term strategy diverge.
The short-term investor asks: “Why has the price fallen?”
The strategic investor asks: “Can I acquire more metal now? Is the GSR attractive? Can I improve my average purchase price? Does this correction fit my long-term objectives?”
Fear and greed are poor advisers. Fear often leads investors to sell during weak market phases. Greed often leads them to buy during overheated markets. Strategy, by contrast, creates distance. It helps investors avoid emotional decisions and act according to clear principles.
CONCLUSION: DO NOT FOCUS ONLY ON PRICE, BUT ON STRATEGY, QUANTITY AND OBJECTIVES
Price matters. But it is not everything.
Anyone who focuses only on short-term price appreciation will become nervous during every correction. Those who think long term, however, often recognise opportunities in pullbacks. They look not only at price, but at quantity. Not only at the daily market price, but at the GSR. Not only at profit, but at security, liquidity, ownership, tax advantages, purchasing advantages and family wealth.
The Elementum strategy follows precisely this long-term approach: Strategic wealth accumulation, wealth optimisation and wealth protection through physical precious metals, with the objective of building more real assets over time.
My advice is therefore this: do not focus only on the price. Ask yourself what objectives you are pursuing, which expectations are realistic and which strategy is right for you.
Because in the end, the perfect entry point is not what matters most. What matters is whether you have built real assets over the years, securely, liquidly, tax-efficiently and strategically optimised.
Note: This article does not constitute individual investment, legal or tax advice. Precious metal prices fluctuate, forecasts are uncertain and tax advantages always depend on personal circumstances and the applicable legal framework.
How can you buy precious metals cheaply and store them safely?
Elementum Deutschland GmbH, based in Sindelfingen (Germany), specializes in trading physical precious metals. Customers who purchase precious metals from Elementum Deutschland (or one of the other national Elementum companies in five European countries) can store them in the renowned high-security vaulting facilities in the St. Gotthard Massif in Switzerland at Elementum International AG.
Of course, you also have the option of purchasing gold and silver directly and having it delivered to your desired address. However, storing silver in the so-called open duty-free warehouse (“offenes Zollfreilager”) at St. Gotthard offers decisive tax advantages:
- The 19% value added tax customary in Germany is completely waived on purchases and sales – a considerable price advantage that effectively secures you 19% more silver for your money.
- If you store your silver in this high-security vault, you can sell it back to Elementum Deutschland GmbH at any time – without any bureaucratic hassle and also without VAT, as the trade takes place within the duty-free warehouse. You will receive the funds via bank wire.
- VAT is only payable when you physically remove the stored silver – either by picking it up in person (after prior notification) or by having it shipped to your address.
More silver, more return
Thanks to duty-free storage, you receive 19% more physical silver when you buy. This additional amount also participates in the performance of the silver price if it rises – a leverage effect that significantly improves your return opportunities.
About Elementum
Elementum is a second-generation, owner-managed family business. Trust, consistency, and long-term thinking are at the heart of our philosophy. The Board of Directors of Elementum International AG is composed of internationally renowned experts in the money and precious metals markets, including economists, analysts, university professors, and precious metals specialists. This in-depth expertise forms the backbone of our actions – for your security, your assets, and your future.
About the Author
Bojan Pravica
Founder of Elementum
Elementum is more than just a company – it is the life’s work of the Pravica family, built with love and dedication over three generations to ensure security and financial prosperity. Founded by Bojan Pravica, a man who came from humble beginnings, Elementum embodies the ceaseless desire for freedom and a happy, carefree life.
Bojan Pravica knows the challenges of life from personal experience. Having grown up in poverty, he saw first-hand how worries and uncertainties can weigh heavily on a family’s life. These experiences left a deep mark on him and fuelled a tireless desire to provide a better life for his family. In doing so, he wanted to do more than just build up a financial cushion. He wanted to leave a legacy for everyone who matters to him. To this day, Bojan Pravica continues this legacy together with his children and grandchildren, determined to pass on values such as financial security, freedom and prosperity. A native of Slovenia, Mr Pravica has lived in Germany since 1973. For over 45 years, he has worked as an independent entrepreneur in various areas of training for financial service providers, as well as a seminar leader both at home and abroad, and as the initiator and developer of financial companies offering exclusive products in the fields of property, insurance, securities, investment funds, unit-linked policies, and specialised product offerings in the precious metals sector.
Contact
Rockstone News & Research
Stephan Bogner (Dipl. Kfm., FH)
Müligässli 1, 8598 Bottighofen
Switzerland
Phone: +41-71-5896911
Email: info@rockstone-news.com
Disclaimer: This article may contain links to external third-party websites. Elementum is not responsible for the content of these external sites and expressly distances itself from all information provided there. At the time the links were created, no unlawful content was identifiable. This article does not constitute a recommendation to buy or sell. Elementum International AG is a Swiss company that specializes exclusively in the storage of physical precious metals in a high-security vault facility located in the St. Gotthard mountain massif in Central Switzerland. The Board of Directors and Executive Management of Elementum International AG have been selected solely based on their professional expertise and long-standing experience in precious metals markets. As these individuals may also be professionally active outside their roles at Elementum International AG, the company has no influence over their external activities and respects their right to freedom of expression. Therefore, the views expressed by persons working with or for Elementum do not necessarily reflect the opinion of Elementum International AG. Investments in precious metals are subject to risks, including those specific to the structure of this market. Please read our full risk disclosures and consult a licensed financial advisor before making any investment decisions. Neither the author, Elementum International AG, nor Elementum Deutschland GmbH assume any liability for actions taken based on the information provided. Past performance is not indicative of future results. The cover picture has been obtained and licenced from 123rf.com.
