Silver ETF Metal Holdings Climb Back Near Record

August 14th at 10:38am by John Spence

Investors in silver exchange traded funds have viewed the recent price weakness and consolidation as a chance to buy the metal as holdings in silver-backed ETFs climb back toward record levels.

Silver held in exchange traded products has risen for three months and is now valued at $16.2 billion, Bloomberg News reports.

“Investors bought 797 tons through silver-backed ETPs this year and now hold 18,093 tons, equal to more than eight months of global mine output,” according to the report. “They sold a net 812 tons from ETPs last year. Total assets are now 2.9% below the record 18,639 tons reached in April 2011.”

The $8.8 billion iShares Silver Trust (NYSEArca: SLV) is the largest ETF with about 9,742 metric tons of silver.

The silver ETF is down 4.1% for the trailing three months, and flat for 2012, according to investment researcher Morningstar.

From a technical perspective, J.C. Parets at All Star Charts says silver being able to hold a key support level in recent months is constructive, even though investors seem to have lost interest in silver. He also cited positive momentum divergences and flattening long-term moving averages as positive factors for silver.

iShares Silver Trust

Chart source: All Star Charts

Full disclosure: Tom Lydon’s clients own SLV.

The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

Tickers