Silver ETFs Falling Harder than Gold

Today we examine one of the weakest performing commodity based ETF categories thus far in 2013, Silver.

Much has been made of the staggering performance in sister precious metal Gold this year corresponding with huge asset outflows in leading Gold ETPs (GLD -$16.7 bln YTD, IAU -$1.4 billion YTD), and in reality Silver has fared much worse (to the tune of about 1000 basis points worse year to date).

The largest ETF in terms of assets under management that focuses on Silver is SLV (iShares Silver, Expense Ratio 0.50%), which currently has $6.9 billion in AUM and no signs of mass outflows despite the poor performance this year (YTD it has actually added $76 mln via creation activity).

The next closest ETP in terms of size behind SLV in this category is the leveraged AGQ (ProShares Ultra Silver, Expense Ratio  0.95%) which is designed to deliver two times the daily return of silver bullion, and this fund has become quite popular among short term traders and aggressive hedgers and speculators on the “bull” side.

AGQ is trading at its lowest levels since the fall of 2011, and now averages a healthy 1.8 million shares traded on an average daily basis. Other substantially smaller ETPs in the Silver category include SIVR (ETFS Silver Trust, Expense Ratio 0.30%), ZSL (PowerShares UltraShort Silver, Expense Ratio 0.95%), USLV (VelocityShares 3X Long Silver ETN, Expense Ratio 1.65%), DBS (PowerShares DB Silver, Expense Ratio 0.79%), DSLV (VelocityShares 3X Inverse Silver ETN, Expense Ratio 1.65%), USV (E-TRACS UBS Bloomberg CMCI Silver ETN, Expense Ratio 0.40%), and the newly launched SLVO (Credit Suisse Silver Shares Covered Call ETN, Expense Ratio 0.65%).