JustChartsWhat Is the Gold–Silver Ratio and How Do Traders Use It?
The gold–silver ratio is the gold price divided by the silver price — how many ounces of silver buy one ounce of gold. At $2,400 gold and $30 silver the ratio is 80. Traders watch it for extremes: a historically high ratio suggests silver is cheap relative to gold, a low one that gold is cheap relative to silver.
Key facts
- Formula
- gold price ÷ silver price
- Example
- $2,400 ÷ $30 = 80
- Since 2000
- low ≈ 32 (2011), high above 120 (2020)
- High ratio
- silver cheap relative to gold
- Low ratio
- gold cheap relative to silver
How to calculate it
Gold–silver ratio = price of 1 oz gold ÷ price of 1 oz silver
Both metals are priced per troy ounce, so the ratio is unit-free.
What range has it traded in?
Since 2000 the ratio has mostly moved between roughly 45 and 90. Its extremes came when silver boomed in April 2011 (about 32) and during the March 2020 market crash (above 120). Over centuries it has been much lower, but modern markets are not tied to the old fixed ratios.
How traders use the ratio
- Relative value: when the ratio is historically high, some traders favour silver over gold (or buy silver and sell gold), betting the ratio falls back; when it is low they do the opposite.
- Risk sentiment: silver has more industrial demand, so it often underperforms gold in recessions and outperforms in strong economies. A rising ratio can signal risk aversion.
- Timing, not a signal on its own: the ratio can stay extreme for years. It works best combined with trend and macro analysis.
Things to watch out for
Gold and silver positions are sized very differently — see 1 lot of gold and 1 lot of silver. To balance a ratio trade, match the dollar value of each side, not the number of lots.
Frequently asked questions
What is a good gold–silver ratio?
There is no “correct” value. Many traders treat readings above about 80–90 as high (silver relatively cheap) and below about 50 as low, based on the range since 2000.
Why is silver more volatile than gold?
Silver’s market is smaller and about half of its demand is industrial, so it reacts more to the economic cycle and to speculative flows.
Does a high ratio mean silver will go up?
Not necessarily. It only says silver is cheap relative to gold; the ratio can fall because gold drops rather than silver rising, and it can stay high for a long time.
Put it into practice
Live charts, an economic calendar and trading calculators — free with a JustCharts account.
Compare gold and silver on live chartsThis article is for education only and is not financial advice. Trading leveraged products carries a high risk of losing money. Contract sizes, trading hours and leverage limits vary by broker and country — always check your own broker’s specifications.