What is silver?
Silver is a precious metal that, like gold, has been used in jewellery and coins for thousands of years. The difference is price: the same weight of gold usually costs dozens of times more than silver. That is why some call silver “poor man’s gold”.
But silver is not just a jewellery metal. Because it conducts electricity extremely well, it is used in electronics, solar panels, cars and medical equipment. So the silver price depends not only on people looking for a “safe” asset but also on factory demand.
Say Mitu inherits a pair of silver anklets from her grandmother. She sees in the news that silver has risen a lot in a few months and thinks selling will bring a big gain. At the shop she learns that when buying old silver jewellery, the shop deducts a large share of the weight. Even with the price up, she will get much less than she expected. The story is imaginary.
Why it matters to an investor
- To understand the risk: silver swings much more than gold; it has fallen sharply within days.
- To measure costs: in Bangladesh the deduction on selling silver jewellery is far larger than on gold, so the price must rise a lot before you profit.
- To see the link with the economy: when factory demand drops, as in a recession, silver can come under pressure, which is different from how gold tends to behave.
- To think about diversification: gold and silver often move together, so holding both does not automatically spread your risk.
Where demand for silver comes from
According to the Silver Institute’s World Silver Survey 2025, total world demand for silver in 2024 was about 1.16 billion ounces. Of that, about 680 million ounces, more than half, went to industry; about 209 million to jewellery and about 191 million to bars and coins.
Much of gold’s demand comes from jewellery, central banks and investment. For silver, factories, especially solar panels and electronics, play a big role. So silver behaves both as a “precious metal” and as an industrial raw material.
Why the price jumps so much
The silver market is much smaller than gold’s, so even modest money flowing in or out moves the price more. History has striking examples: after rising to about $50 an ounce in January 1980, it fell to about $11 by the end of March, a drop of roughly 78% in two months. In 2011, too, it climbed close to $50 and then fell back.
The recent picture is the same. In October 2025 silver broke its old record at about $54, and at the end of January 2026 it touched a high of about $122. But within days, by 2 February, it was back to about $71: a fall of more than 40%.
- The gold–silver ratio: by the World Bank’s figures, in 2025 gold averaged about $3,442 an ounce and silver about $40, so gold was about 86 times dearer by weight. This ratio itself changes a lot over time.
Buying and selling silver in Bangladesh
As with gold, BAJUS announces silver prices by carat (22, 21, 18 carat and traditional). Under BAJUS’s 2023 guidelines, the minimum making charge on silver jewellery was Tk 26 per gram. The deductions on sale were much higher: 30% of the weight on exchange, and 40% when a shop buys old silver. For gold, the same guidelines set 10% and 20%. BAJUS revises these rates from time to time.
The baggage rules (revised June 2025) allow up to 234 grams of silver in place of a gold bar. And the Finance Bill 2026 proposed a capital gains tax on profits from selling gold, silver and jewellery declared in the tax return. These rules can change; check the current Finance Act and NBR rules.
Worked example
- Say you buy silver jewellery containing Tk 10,000 worth of silver (not counting the making charge).
- Sell the next day at the same price and, after a 40% deduction on the weight, you get Tk 6,000.
- Just to get Tk 10,000 back, the silver price must rise by 10,000 ÷ 6,000 ≈ 1.67 times, about 67%. More if you count the making charge.
Result: even when silver jumps in the news, it has to rise a great deal before selling jewellery shows a profit. The rates are an example based on the 2023 guidelines; actual rates may differ by shop and over time.
Common mistakes
- Treating silver as “cheap gold” and assuming its risk is the same. Silver swings far more.
- Buying because the news shows a record price. In 2026 the price fell more than 40% within days of a record.
- Working out a profit without knowing the deduction on selling jewellery.
- Thinking that holding both gold and silver spreads risk; they often move in the same direction.
Silver is cheaper than gold but more volatile, and the deduction on selling jewellery is bigger: count both before counting on a gain.