A look at the precious metal’s plunging price
Since last fall, silver has soared – up a whopping 148% from the end of September through January 29, 2026, versus 4.6% for the S&P 500.
Then came January 30, 2026, when investors were reminded why precious metals are often considered speculative investments. The price of silver plummeted 26.4% (see the chart of the last 20-years)—its biggest one-day drop since at least 1949. Gold also took it on the chin, with the world’s largest gold ETF down more than 10% on Friday (the largest single-day decline since its 2004 inception).
Daily Return for Silver in U.S. Dollars
Bloomberg, calculations by Horizon, data as of 01/30/2026
Although Horizon does not actively invest in commodities, it’s worth examining this historical development for important takeaways. For starters, it’s important to remember that silver and gold were up 400% and 105%, respectively, from the end of 2024 through January 29, 2026. In the wake of enormous run-ups like these, it’s not unreasonable for asset classes to experience a sizable downturn.
But the severity of last week’s declines stems from both gold and silver lacking strong fundamental support for those historic gains. While prices were initially driven higher by concerns about (among other things) rising government fiscal deficits and the direction of the dollar, massive investor speculation ultimately became the main fuel for these assets.
When that happens, it doesn’t take bad news for prices to fall—it merely takes less good news.
That’s what investors felt they got late last week when President Trump nominated Kevin Warsh as the new Federal Reserve Chair. Warsh is seen as an inflation hawk whose approach could lead to tighter monetary policy, which in turn would dampen demand for precious metals. Silver’s decline following the news was particularly sharp, given its thinner liquidity and higher volatility.
The upshot: When investors get nervous, it’s often the most stretched areas of the global financial markets that feel the pain first.
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