Gold prices are continuing their upward momentum so far in 2025 with silver following closely behind. Silver could eventually overtake gold as the current macroeconomic forces could be forming in its favor.
“We think the setup in silver is exceptionally strong,” said TD Securities’ senior commodity strategist Daniel Ghali, in a Kitco News report. “This is the most compelling case in commodities markets today.”
As mentioned, Ghali noted that silver could even eventually overtake gold. In the long-term horizon, silver’s electrical conductivity properties make it an essential metal. It will be paramount in the ongoing global electrification.
Right now, silver is already seeing high demand. In countries like Korea, banks are halting the sale of silver bars as investors hedge against potential market volatility amid tariff wars.
In the U.S., the scramble for silver is occurring to fill supply deficits. This can also nudge silver prices higher.
“This isn’t the silver squeeze narrative that you’ve heard about, this is the silver squeeze that you can buy into,” Ghali added. “What’s happening here is an artificial catalyst that has forced London inventories to drain at an exceptional rate in favor of U.S. based inventory starting to rise at an incredible rate. The issue there that is unique to silver is that the U.S. just so happens to be a significant end-user destination, that silver just so happens to be in a structural deficit that is at least four years running consecutively, and that it’s not exactly clear to us that the stockpile of above ground ‘invisible inventories,’ as you might call them, will come back to market at current prices. Prices actually have to rise in order to incentivize inventory accumulation from unconventional sources, in our view.”
2 Silver Exposure Options
Given the momentum surrounding silver, Sprott has a pair of exposure options to consider. One option looks at silver exposure directly while the other combines exposure to gold.
The Sprott Physical Silver Trust (PSLV ) provides exposure to silver without the additional hassle of storing it. It invests in unencumbered and fully allocated London good delivery silver bars. Additionally, shareholders can redeem their shares for physical bullion anywhere in the world (subject to certain minimum conditions) if they want a more tangible investment experience.
Investors looking to simultaneously get both gold and silver exposure should consider using the Sprott Physical Gold and Silver Trust CEF. This can further diversify precious metal exposure. That gives investors the growth component of silver as clean energy technology demand increases. It also derives gold’s store of value benefits.
CEF is a closed-end trust that invests in unencumbered and fully allocated physical gold and silver bullion in LGD bar form. Overall, CEF aims to provide a secure, convenient, and exchange-traded investment alternative for investors who want to hold physical gold and silver without the inconvenience typical of a direct investment in physical bullion.
For more news, information, and analysis, visit the Gold/Silver/Critical Minerals Channel.
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Past performance is no guarantee of future results. One cannot invest directly in an index. Funds that emphasize investments in small/mid-cap companies will generally experience greater price volatility. Diversification does not eliminate the risk of investment losses. ETFs are considered to have continuous liquidity because they allow an individual to trade throughout the day. A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses, affect the Fund’s performance.
Sprott Asset Management USA, Inc. is the Investment Adviser to the ETFs. ALPS Distributors, Inc. is the Distributor for the ETFs and is a registered broker-dealer and FINRA Member. ALPS Distributors, Inc. is not affiliated with Sprott Asset Management LP or VettaFi.
Exchange Traded Funds (ETFs): SETM, LITP, URNM, URNJ, COPP, COPJ, NIKL, SGDM and SGDJ
