CPM Group
Commodities Research and ConsultingPrecious Metals Summertime Investing: Buying When Others Are Not
‘Sell in May and go away” is not good advice. It never has been good advice for most investors. Not for precious metals, and maybe also not for stocks. It certainly is not the best advice this year.
We all have heard the stock market adage ‘Sell in May and go away.’ It is predicated on the seasonal trends in stock market investors’ buying and selling patterns. It is bad advice, for silver and gold as well as stocks and bonds.
The reality is that there are seasonal patterns in investor buying of silver, gold, stocks, and bonds, and these seasonal patterns often lead to stronger upward price tendencies in the first four months and the last four months of any given year, with prices moving sideways to lower during the middle part of a year.
That said, selling in May is not the best advice. The best advice is to use the middle part of the year to regroup, reposition, and add to one’s investments. Buying silver and gold when others are looking the other way during a quiet period is smarter than chasing prices higher along with the crowd.
Bernard Baruch often was asked what the secret was behind his investment prowess and success. He would say, “Buy straw hats in the wintertime. Summer will surely come.” In other words: Do not chase investments higher but wait for them to be out of favor to buy at lower, better prices, understanding that higher prices most likely will follow.
Baruch was not alone in taking such a ‘value investor’ approach to investments. Warren Buffet has repeatedly said, “Be fearful when others are greedy and greedy when others are fearful.”
CPM is notorious for being a value investor. When gold spiked above $1,000 for the first time when Bear Stearns was insolvent in March 2008, CPM’s advice to its clients was to stop buying, buy $900 puts for August expiration, and then wait to expect to sell those puts for profits and resume physical buying when prices fell to around $900. We advised that we thought that would occur within a month. Instead, it took four trading days for the price to fall from its $1,033.90 intraday peak to $904
“This CPM Group Market Commentary was produced for Silvercorp, one of the premier silver mining companies. We would like to thank Silvercorp for making this paid CPM Group research available free of charge.
Silvercorp offers investors exposure to silver production through its enhanced leverage to the metal. The Company’s mines have been consistently profitable, further bolstered by rising silver prices.”
A Buying Opportunity: Not A Time To Sell
Precious metals prices appear to be settling into a consolidation phase characterized by prices rising and falling in volatile trading ranges. Silver and gold prices rose sharply from September 2025 through January 2026, as investors poured into these metals’ markets based on a range of economic and political concerns. Prices then cooled off and declined some, but have remained at historically high levels as they are consolidating.
Given that the economic and political issues that have driven investors to buying record amounts of silver and gold have not gotten better but actually have grown more problematic, the likelihood is that investor buying will pick up steam again, driving prices to new records. CPM’s best estimate is that the current consolidation phase may last through August but seems likely to open into another round of sharp price increases in the last four months of this year – similar to what happened in 2025.
Based on these considerations, now is not a time to sell. It is a time to buy.
Adept and aggressive investors may take the period from May through August as a time to use futures, options, or ETFs to try to earn some profits from any price weakness, but the weaknesses are more likely to be relatively small and short-lived dips rather than the end of the quarter-century-long bull markets in silver and gold. And, for the most part those aggressive investors who do engage in such short-term speculative trading are holding onto their physical silver and gold.
The charts at the end of this Market Commentary illustrate silver and gold prices over the past two and a half years, as well as the average seasonality of silver and gold prices from month to month.
Invest Based On Realistic Expectations
One of the pitfalls that many investors fall into is that they think only in extremes. They worry about the next Depression or Hyperinflation. They think silver and gold prices will rise to unrealistic levels, or plunge to price levels that are equally unsustainable based on the supply and demand fundamentals of the market. This problem presents itself both in the short term – the next few months – and in the long run.
Such extremes are extremely unlikely. CPM has written reports concluding that for many reasons the probabilities are less than 1% of either a future Depression as occurred in the 1870s, 1880s, 1890s, and 1930s or a period of hyper-inflation, such as actually never have been experienced in the United States and Canada since at least the 1860s.
Investors need realistic guides and expectations. They need to remain aware of those 1% extreme probabilities, but base their investments on the other 98% of probabilities. Once they develop this critical thinking capacity, investors can make better decisions.
Yes, silver and gold prices may decline over the next few months, for seasonal as well as event-driven reasons. But investors need to internalize realistic expectations of how low silver and gold may decline over the next three months, expectations built on realistic expectations of what may happen in the economic and political environment, and what may happen to silver and gold mine production, secondary recovery from scrap, fabrication demand, investment demand, world trade in these metals, and inventories.
Silver might spike down to $60, $50, or even lower, but probably not much lower. Gold might spike down to $4,100, $3,800, or even $3,500 (all record prices by pre-September 2025 standards). Any such spikes most likely would be short-lived, given the state of the world at present.
In short: These are not necessary the sorts of price declines that would warrant selling silver and gold. Instead, they represent potential buying opportunities before prices rise once again.
It’s not a matter of selling in May or June and going away. A better investment approach is to buy straw hats in December, when no one else wants them.
Note: Seasonality calculations look at the average deviation from the annual price across each month, showing months of typically stronger and weaker price levels. Values above 100 indicate relatively stronger seasonal performance; values below 100 indicate relatively weaker seasonal performance. Data is adjusted to give greater weighting to more recent data.
“This CPM Group Market Commentary was produced for Silvercorp, one of the premier silver mining companies. We would like to thank Silvercorp for making this paid CPM Group research available free of charge.
Silvercorp offers investors exposure to silver production through its enhanced leverage to the metal. The Company’s mines have been consistently profitable, further bolstered by rising silver prices.”
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