At time of writing the share price of Silver Mines Limited [ASX:SVL] is up 11.29%, trading at 6.9 cents.
As a pure play silver company, the SVL share price as you can see is highly correlated with the silver price. You can see the two paired up on the chart below:
Today we look at Silver Mines’ recent reply to an ASX price query and the relationship between gold and silver.
Nothing shady about SVL share price increase
The ASX sent a price query letter to SVL yesterday which said:
‘We note the change in the price of SVL’s securities from a low of $0.045 on 15 July 2019 to a high of $0.062 today, 18 July 2019. We also note the significant increase in the volume of SVL’s securities traded from 16 July 2019 to 18 July 2019.’
It was a sharp increase but one which Silver Mines says can be explained by the recent movement in the silver price.
They note that, ‘The silver price has increased by approximately US$1.50 per ounce (10.3%) since 16 June 2019. Since 16 July 2019, the silver price has increased from approximately US$15.30 per ounce to a high of approximately US$16.32 per ounce (6.7%).’
They continue their response to the price query by noting that their 100% owned Bowdens Silver Project in central NSW ‘is the largest known undeveloped silver project in Australia and one of the largest globally.’
Source: Silver Mines Limited
It has come down from as high as 93 with silver’s recent charge, but is still well above the long-term average.
With silver demand in the auto sector (EVs) and solar cells projected to increase, there could be something more sustained behind silver and Silver Mines’ recent rise.
Speaking of battery metals, our free nickel stocks report could be just what you are after. We look at the companies with exposure to the looming battery boom.
If gold is more your thing, our editor Greg Canavan gives you an insightful look at why physical ownership could be the preferred option in the current environment. That report can be downloaded here.
For Money Morning