Commodity-based exchange-traded funds such as silver ETFs are becoming increasingly popular.
Why? Well, many investors are newbies Purchase of shares I’ve heard that commodities do well in an inflationary environment.
In the case of gold and silver, this myth is generally debunked. In fact, gold and silver are not safe havens in inflationary environments for the long term.
However, when we see Quick
inflammationAn environment that many investors think we may be heading towards is more money printing, silver and gold performing so well.
In contrast, companies in the technology sector (or even Technology ETFs) struggle, for example, due to excessive cash burn.
So in this situation, many people Canadian ETF Investors are looking for that Best Silver ETFs in Canada To gain exposure to the precious metal. In this article, we are going to present them to you.
What types of silver ETFs are available in Canada?
Generally when you look at silver ETFs or any commodity ETF for that matter, there are 3 specific categories:
- Physical ETFs
- Equity ETFs
- Futures based ETFs
With silver ETFs, you want to buy an ETF that holds the underlying commodity.
With equity silver ETFs, you want to gain exposure to silver miners by buying an ETF that owns their shares.
Finally, futures-based silver ETFs use futures contracts to bet on the price of the metal.
This article does not talk much about futures ETFs because they are advanced investment products. However, we offer a good mix of physical and equity-based silver ETFs to help you make an informed decision about what you want to buy today.
Best Silver ETFs in Canada to Buy Now
- Sprat Physical Silver Trust ETG (TSE:PSLV)
- Global X Silver Miners ETF (ARCA:SIL)
- ETFMG Prime Junior Silver Miners ETF (ARCA:SILJ)
Sprat Physical Silver Trust ETF (TSE:PSLV)
The Spratt Physical Silver Trust (TSE:PSLV) is a physical silver ETF that gives Canadians exposure to the real metal and is one of the best ways to own silver in Canada today.
The ETF is liquid, with over 3M shares traded per day and over $2.9 billion in assets.
An interesting concept of Sprat Silver ETF is that investors have the ability to redeem their units for actual silver.
Now, there are certain conditions that need to be met, such as that you have to have units equal to 10 1000oz silver bars, but this is a unique feature.
Another key factor for Spratt is that there is no “middle man” when it comes to their silver bullion. In some situations, silver ETFs store their silver in a financial institution. If that company goes bankrupt, silver may be at risk.
All of Spratt’s physical silver is in custody at the Royal Canadian Mint, a federal Crown corporation of the Government of Canada.
Total charges for this silver ETF are around 0.67%, which means you pay $6.70 for every $1000 invested.
In terms of overall revenue, fiscal deficit. It was primarily launched in 2010, when silver prices were extremely high due to the fallout from the financial crisis.
Since its inception, the price of silver has increased by 7%, while the PSLV has fallen by 32%.
But with a silver ETF, you buy because of expected future performance. So, I will not give too much importance to past results.
Overall, if you want to own physical silver, this is the best silver ETF in Canada.
Global X Silver Miners ETF (ARCA:SIL)
Unfortunately, there aren’t many silver ETFs in Canada that focus on miners. As a result, you have to go south of the border to get any meaningful exposure.
However, the Global X Silver Miners ETF (ARCA:SIL) There is more drama in Canadian silver mining as all 3 major holdings are currently Canadian miners:
- Wheaton Precious Metals (TSE:WPM)
- Pan American Silver Corp (TSE:PAAS)
- SSR Mining (TSE:SSRM)
The Silver ETF has more than $860M in net assets at the time of writing, and with more than 420,000 shares changing hands every day, you won’t struggle in terms of liquidity.
One thing you should prepare yourself for with this top Canadian silver ETF is volatility.
This ETF is subject to significant price fluctuations. For example, let’s look at the last 8 years in terms of overall performance:
- 2021: -19%
- 2020: +41%
- 2019: +34%
- 2018: -22.6%
- 2017: +1.04%
- 2016: +80.34%
- 2015: -33%
- 2014: -16.9%
- 2013: -50.31%
These price fluctuations have actually resulted in an average annual loss of -9.3% for the Silver Mining ETF over the past decade.
As most mining-based ETFs can underperform, its poor performance is based on the poor performance of the underlying commodity.
Miners tend to outperform the underlying commodity in bull markets and underperform the commodity in bear markets.
So, if you believe silver will advance, this silver ETF could do well.
In terms of fees, they total 0.65%, which means you pay $6.50 per $1000 to own an ETF.
SIL has actually tracked the price of silver very closely over the years. This is primarily because it exposes the largest and most reliable silver miners in the world.
ETFMG Prime Junior Silver Miners ETF (ARCA:SILJ)
If you want the biggest risk/reward exposure to silver through silver ETFs, the ETFMG Prime Junior Silver Miners ETF (ARCA:SILJ) Be where you want to be.
Why? Well, it’s a junior silver mining ETF, meaning it’s made up of smaller companies focused on silver mining.
If you are new to junior miners with silver and any commodity, they are exposed to significant price fluctuations.
Again, this is a US listed ETF. However, the top 10 holdings are essentially all Canadian, accounting for more than 63% of assets at the time of writing. In fact, 8 of the top 10 holdings in this ETF are Canadian listed stocks:
- First Majestic Silver (TSE:FR)
- Pan American Silver Corp (TSE:PAAS)
- MAG Silver Corp (TSE:MAG)
- Yamana Gold (TSE:YRI)
- SilverCrest Metals (TSE:SIL)
- Turquoise Hill Resources (TSE:TRQ)
- Silvercorp Metals (TSE:SVM)
- Endeavor Silver Corp (TSE:EXK)
With $629 million in net assets and over 1.4 million shares in total daily volume, this is the most active silver ETF on this list, and you’ll have no problem buying and selling shares whenever you want.
And in terms of performance, the best performing silver ETFs in this list over the last 1, 3 and 5 year time frames. In fact, its 5-year average annual return is -5.5%.
However, this ETF is very volatile. The ETF lost 53%, 11% and 37% over the previous 3 years before posting a massive 139% gain in 2016.
The ETF has a beta of 1.68, when the market moves 1%, this ETF moves 1.68%, highlighting its volatility.
Total fees are 0.69% or $6.90 per $1000 investment. So, it’s more expensive overall, and it’s actually a higher fee for an ETF. However, when we move to such “core” ETFs, we can expect to pay higher fees.
This is the riskiest silver ETF on this list and should be reserved for those with a high tolerance for risk.
Interestingly, ETFs have actually underperformed silver prices, primarily due to the Covid-19 market crash and its impact on junior miners.
Overall, these top Canadian silver ETFs are ideal for gaining exposure to the metal
If you’re bullish on silver, these are the silver ETFs you’ll want to look into. In my opinion, Sprat’s PSLV is the best way to hold real silver through an ETF because of the security and the way it holds physical silver.
The iShares Silver Trust (ARCA:SLV) is an alternative. However, regulatory circumstances such as it not being registered as a cargo pool make me lean towards Spratt’s version. However, iShares Silver Trust is definitely the most liquid physical silver ETF on the market. So, it is an option.
Before you buy, understand what you’re buying.
We’re limited here in terms of silver ETFs when it comes to producers, so the two US listed ETFs I’ve shown you here, when it comes to miners, whether they’re big producers in SIL or juniors in SILJ. Your best expressions.
Overall, I hope you enjoyed this list of best silver ETFs and if you find any useful, feel free to contact us and we will add them to the list.