Goldman Sachs warns of extreme volatility in silver: risks on both sides, investors avoiding volatility should be cautious

Goldman Sachs latest states that silver prices will continue to experience extreme volatility, facing both upside and downside risks. The firm advises clients who are averse to volatility to exercise caution. At the same time, Goldman Sachs believes that the likelihood of the US imposing trade tariffs on silver is low. This view presents an interesting contrast to the recent overall optimism on precious metals markets on Wall Street.

Goldman Sachs’ Silver Outlook: Dual Risks Coexist

Goldman Sachs’ statement this time is quite restrained, using phrases like “could rise or fall,” essentially indicating that the direction of silver is uncertain. Behind this wording reflects that, although the overall environment for precious metals has support, the specific asset of silver faces many uncertainties.

Why silver instead of gold

Interestingly, according to the latest news, the five major Wall Street institutions (Goldman Sachs, JPMorgan Chase, Morgan Stanley, Bank of America, UBS) have rarely agreed on gold—they all see continued upside. But regarding silver, Goldman Sachs has taken a more cautious stance.

The logic behind this is worth considering:

• Gold: Mainly driven by safe-haven demand and monetary policy, with clear institutional consensus
• Silver: Has both precious metal and industrial metal attributes, with more complex demand sources, and indeed greater volatility

Silver’s dual identity (as a safe-haven asset and industrial raw material) makes it more sensitive to economic cycles, which also explains why Goldman Sachs emphasizes its volatility.

Trade tariff risk is relatively manageable

Goldman Sachs believes that the possibility of the US imposing trade tariffs on silver is low, which is a relatively positive signal. This indicates that, at the policy level, silver is not a primary focus of trade friction, and the market does not need to overly worry about this risk.

What does this outlook mean for investors

Responses for different risk preferences

Goldman Sachs specifically mentions that “clients averse to volatility” should exercise caution, which is essentially a risk stratification:

• Low risk appetite investors: Silver may not be suitable for allocation; gold is a more stable choice
• Moderate risk appetite investors: Can focus on specific volatility triggers in silver to find trading opportunities
• High risk appetite investors: Volatility itself is an opportunity, but requires stronger risk management

Potential reasons for persistent volatility

Although the news brief does not explicitly specify the causes of volatility, based on the market environment, possible driving factors include:

• Uncertainty about global economic growth prospects
• Changes in Federal Reserve policy direction
• The ebb and flow of industrial demand versus safe-haven demand
• Overall price fluctuation environment in commodities

Summary

Goldman Sachs’ core warning on silver is: do not assume a direction, be prepared for volatility. This contrasts with their optimistic outlook on gold and reflects a divergence within the precious metals market—gold remains steady, silver is more variable.

The takeaway for investors is straightforward: if your portfolio cannot withstand high volatility, silver may not be the first choice; if you have risk tolerance and trading capability, volatility might actually present opportunities. The key is to understand which type of investor you are and make corresponding allocation decisions.