Exchange-traded funds, or ETFs, have existed since 1993, although it took 15 more years for the first actively managed ETF to reach the market.
Since then, ETFs have risen in popularity in large part because they are a cheaper investment option than traditional mutual funds. Today, a huge number of ETFs are in play. ETF shares focus on a variety of spaces, such as derivatives, bonds and commodities.
Within the commodity space are silver ETFs, and investors interested in these have many options to choose from. For instance, some ETFs focus solely on physical silver bullion, while others focus on silver futures contracts. Still others focus on the silver-mining market itself.
Many individuals gravitate towards silver ETFs over a silver mutual fund because mutual funds can only be bought or sold at the close of the trading day, while silver ETFs offer more flexibility as they can be traded whenever the stock market is open.
In order to determine which silver ETF will best suit their precious metals needs, investors should examine the options available to them. Here’s a brief look at
seven of the top silver ETFs, as per data from ETF Database, you may want to consider when expanding your portfolio. The first four are the top silver-backed ETFs while the last three are the top silver mining ETFs.
1. iShares Silver Trust (ARCA:SLV)
As the iShares Silver Trust’s website warns, it is not your standard ETF. Why? Put simply, the iShares Silver Trust is not an investment company registered under the Investment Company Act of 1940 or a commodity pool under the Commodity Exchange Act. Further, its ETF shares aren’t subject to the regulatory requirements that apply to mutual funds.
Investors who are not put off by those conditions may find the iShares Silver Trust appealing. It uses the London Bullion Market Association silver price as its benchmark and holds silver bullion — 555,466,818.70 ounces as of August 17, 2021. Its net asset value clocks in at US$13,272,503,717, and since its inception it has achieved an average annual return of 4.53 percent for its investors.
2. Aberdeen Standard Physical Silver Shares (ARCA:SIVR)
The Aberdeen Standard Physical Silver Shares ETF is also not a typical ETF and very similar to SLV. It’s geared at investors who want to hold physical ounces of silver, and had a total net asset value of US$955.22 million as of August 17, 2021.
SIVR’s investment objective is for the ETF’s shares to reflect the performance of the silver price less the expenses of the trust’s operations.
SIVR silver stocks are held with JPMorgan Chase Bank in London at a secured vault. This ETF reportedly has a good record for correctly tracking the spot price of silver. SIVR’s net asset value is determined by the silver ounce price as set by London Bullion Market Association at approximately 12:00 noon London divided by the number of shares outstanding for the fund at 4:00 p.m. New York time, each trading day.
3. ProShares Ultra Silver ETF (NYSEARCA:AGQ)
Established in December 2008 by ProShare Capital Management LLC, the ProShares Ultra Silver ETF offers investors twice the daily long leverage to silver bullion. AGQ uses derivatives such as futures contracts to invest in silver. ETF Database suggests it may be “a powerful tool for investors with a bullish short-term outlook for silver.”
The ProShares Ultra Silver ETF had net assets of C$522.90 million as of August 17, 2021, with the highest expense ratio of the four physical silver-backed ETFs, at 0.93 percent.
4. Invesco DB Silver Fund (NYSEARCA:DBS)
The Invesco DB Silver Fund is the smallest silver ETF on this list in terms of holdings size. This ETF offers investors exposure to silver through futures-contracts. ETF Database suggests “DBS may be a good choice for investors seeking futures-based exposure to silver but who wish to avoid the hassle of trading on a futures account.”
As of August 17, 2021, the silver ETF’s net assets stood at US$22.93 million and it has a total expense ratio of 0.75 percent.
5. Global X Silver Miners ETF (ARCA:SIL)
The Global X Silver Miners ETF gives investors access to many silver-mining companies. It benefits from the fact that those companies can enjoy quick gains when the price of the metal is rising. Given that it provides exposure to a basket of global silver miners, it also allows investors to avoid the risks associated with individual companies and lets them add geographical diversity to their portfolios.
As of August 18, 2021, the silver ETF’s net assets stood at more than US$1.154 billion and it had a total expense ratio of 0.65 percent at that time.
6. ETFMG Prime Junior Silver ETF (ARCA:SILJ)
The ETFMG Prime Junior Silver ETF bills itself as the “first and only ETF to target small cap silver miners.” The index provides a benchmark for investors to track public small-cap companies in the silver space.
The ETF’s holdings span Canada, the US and the UK, including First Majestic Silver (TSX:FR,NYSE:AG) and Pan American Silver (TSX:PAAS,NASDAQ:PAAS).
7. iShares MSCI Global Silver Miners ETF (BATS:SLVP)
The iShares MSCI Global Silver Miners ETF tracks an index composed of global equities of companies primarily engaged in of silver exploration or metals mining, but skews toward Canadian mining stocks. SLVP has the lowest expense ratio of the silver miner-focused ETFS, at 0.39 percent.
SLVP’s holdings include Pan American Silver, SSR Mining Inc. (NASDAQ:SSRM, ASX:SSR), and Hecla Mining Company (NYSE:HL).
This is an updated version of an article originally published by the Investing News Network in 2014.
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Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
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