Exchange Traded Funds (ETFs)

This Fund Buys the Best and Brightest in Silver

There are many ways to invest in precious metals through exchange-traded funds (ETFs). Gaining exposure to silver mining is as easy as buying shares in the Global X Silver Miners ETF (SIL).

Investing in silver is seen as quite similar to investing in gold. However, there is some thought that gold has had more of a run up in the past and that its price is historically high, while silver might be a better value proposition.

Of course, it is difficult to assess the true “intrinsic value” of each metal compared to the other. But by investing in SIL, you effectively invest in a broad swath of silver mining companies. Indeed, companies held by this fund are weighted according to market capitalization.

SIL has outperformed some conservative gold mining funds over the last year. As a silver fund of the “biggest-and-best” breed, that is a good result.

SIL is up 45% over the last 12 months, higher than gold mega-fund GDX’s return of 39%. While the prices of the two metals do tend to move together, sometimes one will perform a bit better than the other. The expense ratio for this fund is 0.65%, and it does not pay dividends. Its market cap is currently $316 million. The following chart shows SIL’s very strong recent performance.

View the current price, volume, performance and top 10 holdings of SIL at ETFU.com.

Top holdings for this fund include Fresnillo plc, 11.75%; Silver Wheaton Corp. (SLW), 11.66%; Pan American Silver Corp. (PAAS), 11.16%; Tahoe Resources Inc. (TAHO), 10.55%; and First Majestic Silver Corp. (AG), 5.71%. The top 10 holdings comprise 76.09% of this fund’s assets, so it is not as diversified as some other ETFs.

If you are interested in investing in silver, you will want to consider a wide selection of funds before making an investment. I suggest that Global X Silver Miners ETF (SIL) be on your list of possibilities.

If you want my advice about buying and selling specific ETFs, including appropriate stop losses, please consider subscribing to my Successful ETF Investing newsletter.

As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an e-mail. You just may see your question answered in a future ETF Talk.

Doug Fabian

Doug Fabian is the Editor of Weekly ETF Report, a free weekly e-newsletter, and the newsletter Successful ETF Investing. He’s also the host of the syndicated radio show, “Doug Fabian’s Wealth Strategies.” Doug also edits the fast-paced trading service ETF Trader’s Edge, for investors who want to take their profits to the next level. Taking over the reins from his dad, Dick Fabian, back in 1992, Doug has continued to uphold the reputation of the newsletter as the #1 risk-adjusted market timer as ranked by Hulbert’s Investment Digest. Doug became a member of the “SmartMoney 30” in 1999 — a listing of the most influential individuals in the mutual fund industry. In the feature, SmartMoney magazine exclaims that Doug is the best-known “trend follower” among the $56 billion (and growing) group of financial advisors. In 2001, Doug wrote “Maverick Investing,” published by McGraw-Hill. He also regularly appears at seminars around the country, stands out on the pages of the largest newspapers (The Wall Street Journal, The Los Angeles Times, and The New York Times), and speaks on national television (CNBC, Fox News, and Bloomberg Forum). For more than 35 years, Successful ETF Investing (formerly the Telephone Switch Newsletter and Successful Investing) has produced double-digit percentage annual gains. Doug has become known for his expert knowledge and timely use of innovative tools, such as exchange-traded funds, bear funds, and enhanced-index funds to profit in any market climate. For more information about Doug’s services, go to http://www.fabian.com/