Silver-related exchange traded funds have been strong performers with silver futures increasing over 20% this year. Surprisingly, silver miners, which trailed the price movements of the physical precious metal in 2011, are keeping up with silver prices this year.
The iShares Silver Trust (NYSEArca: SLV) has gained 21.3% year-to-date.
Silver prices are increasing as world economies continue to debase their domestic currencies, sending investors to hard assets that are better stores of wealth. Additionally, precious metals are moving higher as an inflation-hedger in light of Greece’s commitment to move forward in deal negotiations, according to Reuters.
If the deal falls apart, James Dailey, portfolio manager of the TEAM Asset Strategy Fund, believes the ECB will continue with more “aggressive in monetizing things and create credit to insulate the banking system from a disorganized default,” which would also boost the appeal for precious metals.
Meanwhile, the Global X Silver Miners ETF (NYSEArca: SIL) is up 17.4% year-to-date. The ETF invests in miner stocks.
The recently launched iShares MSCI Global Silver Miners Fund (NYSEArca: SLVP) will be competing with SIL. [iShares Launches Specialized Global Commodity Producer ETFs]
SLVP tries to reflect the performance of the MSCI ACWI Select Silver Miners Investable Market Index, which holds both developed and emerging market silver mining companies.
According to the ETF Professor on Seeking Alpha, seven of SLVP’s top 10 holdings overlap with SIL holdings. Additionally, Canada and Peru make up 70% of SLVP’s country allocations, whereas SIL is more spread out between Canada, Mexico, the U.K., Russia and the U.S.