December may just be getting started, but things are certainly not looking very chilly for silver prices.
Thus far, the winter season seems to be moving in favor of the precious metal. On Monday, silver began the month of December on a high note, hitting new highs of $58.58 an ounce. Notably, this rally represents year-to-date gains that flirt around the 100% threshold.
While the silver rally alone should warrant close attention, it’s equally as important to understand why silver is doing so well right now. To begin, the global supply of silver is tightening following recent silver flows into London’s market. This has led to tight supplies in other markets like Shanghai, and contributed to higher borrowing costs.
Furthermore, silver, much like gold, is likely well-positioned to benefit from a potential rate cut from the Federal Reserve next week. Should the Fed trim interest rates, advisors and investors alike may continue to move to precious metals as a safe haven and a store of value.
Different Avenues for Expanding Silver Exposure
Even with silver hitting record highs this week, the conditions supporting the rally aren’t slated to abate any time soon. As such, there’s potential for advisors and investors to capitalize on the opportunity.
One way to potentially do so is through the Sprott Physical Silver Trust (PSLV). PSLV invests in fully-allocated and unencumbered London Good Delivery silver bars. This can serve as a valuable and more accessible vehicle for folks looking to gain access to physical silver.
Alternatively, the Sprott Silver Miners & Physical Silver ETF (SLVR) could also offer a potent use case. The fund offers exposure to both physical silver and the silver mining industry itself. This strategy can provide a portfolio with multiple avenues to capitalize on the silver rally.
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An investor should consider the investment objectives, risks, charges, and expenses carefully before investing. To obtain a Prospectus, which contains this and other information, contact your financial professional or call 888.622.1813. Read the Prospectus carefully before investing, which can also be found by clicking one of the links below.
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 USA, Inc. or VettaFi.
Exchange Traded Funds (ETFs): SETM, LITP, URNM, URN, COPP, COPJ, NIKL, SGDM, SGDJ, SLVR, GBUG, METL
Physical Bullion Funds: PHYS, PSLV, CEF, and SPPP.
Gold and precious metals are referred to with terms of art like store of value, safe haven and safe asset. These terms should not be construed to guarantee any form of investment safety. While “safe” assets like gold, Treasuries, money market funds and cash generally do not carry a high risk of loss relative to other asset classes, any asset may lose value, which may involve the complete loss of invested principal.
