XAGUSD: trading silver against the US dollar

• XAG
• USD

What XAGUSD means

XAGUSD is the price of silver quoted in US dollars. "XAG" is the code for silver and "USD" is the US dollar. The quote shows how many dollars one troy ounce of silver costs. A troy ounce is the standard unit for precious metals.

With a broker such as Exness, you do not buy physical metal. You trade a CFD (contract for difference). A CFD is an agreement to settle the price change between opening and closing a position. You can open a long position (gain if the price rises) or a short position (gain if it falls). Either one can lose money.

Silver CFDs are usually traded with leverage. Leverage lets you control a large position with a small deposit, called margin. It increases losses in the same way it increases gains. Leveraged CFD trading can lose money fast, and many traders lose.

Silver as a precious and an industrial metal

Gold is held mostly as a store of value. Silver has two roles:

• Precious metal. Investors hold silver bars, coins and exchange-traded products for the same reasons they hold gold: as protection against inflation, currency weakness or financial stress.
• Industrial metal. Silver conducts electricity and heat better than any other metal. Industry uses it in solar panels, electronics, electrical contacts, batteries, medical products and brazing alloys.

Because of this, silver reacts to two kinds of news. Interest rate decisions, the US dollar and risk sentiment move it like gold. Factory output, solar installation trends and electronics demand move it like copper or other industrial metals. Sometimes these forces push in opposite directions.

Why silver is more volatile than gold

Volatility is how far and how fast a price moves. Silver usually moves more in percentage terms than gold. The main reasons:

• Smaller market. Far less money trades in silver than in gold, so large orders move the price more.
• Two sets of drivers. Industrial demand adds a source of price swings that gold mostly does not have.
• Supply comes as a by-product. Much silver is mined alongside lead, zinc, copper or gold, so supply does not adjust quickly to price.
• Thinner liquidity at quiet hours. Spreads can widen and prices can jump when fewer participants are active, and around major data releases.

For a trader, higher volatility means stop-losses get hit more easily, and a position sized like a gold trade can carry a different risk. Size positions on silver's own behaviour, not on habits from gold or forex.

The gold/silver ratio

The gold/silver ratio is the gold price divided by the silver price. It shows how many ounces of silver buy one ounce of gold. Traders watch it to compare the two metals. Some trade the spread between them, for example long one and short the other.

The ratio is a comparison tool, not a signal. It can stay high or low for long periods. Our gold/silver ratio page explains how it is calculated and how traders read it. For gold itself, see XAUUSD gold.

Contract size and pip value

Contract size is how many ounces one standard lot represents. Silver and gold contracts are not the same size, and brokers can set their own. Exness lists XAGUSD among its metals, but we have no sourced specification for XAGUSD contract size, pip size, volume limits or trading hours. Check the specification in the platform before trading. In MetaTrader, right-click the symbol in Market Watch and open the specification.

Pip is the standard price step used to measure moves. Pip value is how much money a move of one pip makes or loses for your position:

pip value = pip size × contract size × number of lots

The result is in US dollars, the quote currency. If your account is in another currency, the amount is converted. The minimum order on Exness accounts is generally 0.01 lot, but some instruments differ, so confirm the XAGUSD minimum in the platform.

Use the calculator below. Enter the lot size and the contract details from the specification. It shows pip value in the quote currency and your account currency.

Margin and leverage on XAGUSD

Margin is the amount the broker locks to keep a position open:

margin = lots × contract size × price ÷ leverage

Higher leverage lowers the margin required. It does not lower the risk of the position, because each price move still changes your profit or loss by the same amount. Leverage on metals can also be raised by the broker around high-impact news. Exness applies higher margin requirements to orders opened from 15 minutes before to 90 seconds after high-impact news. Check current XAGUSD leverage and margin rules in the platform.

If losses reduce your equity too far, the account reaches a margin call and then a stop out. At stop out, positions are closed automatically. Exness lists these levels: Standard Cent: margin call 60%, stop out 0%; Standard: margin call 60%, stop out 0%; Pro: margin call 30%, stop out 0%; Raw Spread: margin call 30%, stop out 0%; Zero: margin call 30%, stop out 0%. Exness also notes: 0% stop out not supported in some countries; may vary. If a stop out would leave a negative balance, Exness says: balance reset to 0 after stop out. Read more on risk management.

Swaps on silver

A swap is the overnight fee or credit for holding a position past the daily rollover. Exness says by default all accounts are swap-free on listed instruments; the status can be lost. Pakistan is on the Exness list of Islamic countries, where clients are assigned swap-free status automatically. Conditions can change, so confirm your status in the Exness personal area. See swap fees and Islamic finance.

Account types and platforms

XAGUSD can be traded in MetaTrader 4, MetaTrader 5 and Exness's own platforms, depending on your account. Spreads and commissions differ by account type. The Standard account has no commission and spreads from 0.2 pips. The Raw Spread account charges commission up to 3.50 USD each side per lot. These are general account figures, not silver-specific ones. Check the XAGUSD spread and commission for your account in the platform.

Compare accounts on account types. Practise on a demo account first. See also platforms and apps and XAGEUR silver in euro.

Legal position in Pakistan

Pakistani readers should know the local rules before using any offshore broker:

• Payments: per the SBP, remitting foreign exchange to overseas forex/margin/CFD platforms is not allowed through any payment channel (FERA s.5(1)).
• Investor protection: per the SECP, offshore platforms have no Pakistani licence or oversight and offer no legal protection or recourse.

Read law and regulators and regulation and safety before you decide anything.

Frequent questions

What is XAGUSD?

It is the price of silver in US dollars per troy ounce. On a broker platform it is traded as a CFD, not as physical metal.

Why does silver move more than gold?

Its market is smaller, it reacts to industrial demand as well as investment demand, and its supply adjusts slowly. Price swings are usually larger in percentage terms.

What is the XAGUSD contract size on Exness?

We have no sourced figure for it. Open the symbol specification in your platform, then use the pip and margin calculators on this page.

How do I calculate pip value for silver?

Multiply pip size by contract size and by the number of lots. The result is in US dollars and is converted to your account currency.

Is silver trading swap-free for Pakistani clients?

Exness assigns swap-free status automatically to clients from listed Islamic countries, including Pakistan, but the status can be lost. Check your account in the personal area.

Does the gold/silver ratio tell me when to trade?

No. It only compares the two prices and can stay at extreme levels for a long time. It is not a buy or sell signal.