Which Silver Exchange-Traded Products are There?

JP Buntinx
July 7, 2020

In this modern day and age, investing in precious metals is a good idea. Some traders go one step further, and explore the silver exchange-traded products. Several key categories can be identified in this regard. 

Physically Backed Products

The most obvious form of silver exchange-traded products are those that are physically backed by actual silver. Speculating on price differences is great, but one rarely has anything to hold in one’s hand. With physically backed funds products, that situation is very different.

Any fund offering such an option often has ample reserves in physical silver. Whether it is bars or coins, their portfolio of net assets are precious metals. A part of it will be cash, to offer some liquidity in case a rebalancing procedure is required due to changing market conditions. 

Trading physically backed funds can be done with ease. Several different products can be explored, depending on one’s region. Some of the more famous names include Julius Baer Physical Silver Fund, Sprott Physical Silver Trust, and iShares Silver Trust. This latter one has millions of troy ounces of silver under management. 

Leveraged Products

Another popular option, albeit a far riskier one, is to invest in leveraged ETFs. These silver exchange-traded products can be denominated in either silver, gold, or other precious metals. Investors will leverage their position when they go long or short, depending on how they evaluate the current market sentiment.

Dealing with leveraged positions is always a major risk. If the market evolves in the right direction, big profits can be generated. When the market heads south, however, the losses will be a lot steeper. Investing in these types of silver exchange traded products is not advised for newcomers or people who trade based on emotions. 

ETFs Based on Futures

Exploring futures contract trading for silver and gold can be another valuable option. This requires a lot of market insight as one speculates on the price of said commodity month(s) in advance.

Given the sentiment for both silver and gold in 2020, a bullish outlook remains in place. However, blindly investing in futures and expecting the market to remain bullish may not be the most solid strategy either. Always conduct proper research before making any financial commitments.

Performance Tracking Silver Exchange Traded Products

Albeit the following investment options are a bit out of the ordinary, they can still yield significant results. When looking into silver exchange traded products, the performance tracking indexes are crucial. Different forms exist, as some will track a specific sub-Index, whereas others track silver mine stocks, for example. 

In recent years, these indexes have become more popular. That is only normal, as they represent the silver industry on a much broader level .

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