Silver ETFs an Option for Investors to Consider

Bloomberg reported that so far this year, ETFS Physical Silver Shares (ARCA:SIVR) is up 6.4 percent. The news outlet states that though that exchange-traded fund (ETF) “isn’t as big or well-known as the $6.7 billion iShares Silver Trust (SLV),” it “does the same thing for nearly half the cost.”

The report continues:

That gap may not seem like much, but it adds up over time. SIVR outperformed SLV by 1.5 percent over the past five years; the difference is due to to SLV’s higher cost. SIVR has $400 million in assets and trades just under 100,000 shares a day. That’s a healthy amount of trading and puts SIVR in the top quartile of the most liquid commodity ETFs.

Other options for investors include:

Investors can also consider ETFs that focus on silver mining stocks. The PureFunds ISE Junior Silver Small Cap Miners/Explorers ETF (SILJ) tracks small-cap silver miners and explorers. It’s up 48 percent, making it one of the top five performers so far this year, and one of the top five most volatile. It’s about four times as jumpy as the S&P 500. The ETF is tiny, with $10 million in assets, and charges a high expense ratio of 0.69 percent.

Investors comfortable with the credit risk that comes with exchange-traded notes (ETNs) can buy a silver exchange-traded note. ETNs are unsecured debt obligations backed by the credit of their issuer, which adds a risk that wouldn’t exist with, say, SILJ. The Credit Suisse Silver Shares Covered Call ETN (SLVO) has a yield of 16.2 percent, the highest of all exchange-traded products, meaning exchange-traded funds and exchange-traded notes.

Click here to read the full Bloomberg report.