Tactical Signals from a Gold/Silver Ratio?

Can investors holding a position in gold as inflation hedge/equity crash protection improve performance of this position by shifting to silver when the gold-to-silver ratio is high? To investigate, we track the ratio of SPDR Gold Shares (GLD) price to iShares Silver Trust (SLV) price and look to switch from GLD to SLV while the latter is relatively undervalued. Using end-of-month prices of GLD and SLV during April 2006 (limited by inception of SLV) through January 2021, we find that: (more…)