In the past several months, precious metals and mining companies have been outperforming the market. This upcoming series of ETF Talks will focus on some of the best-performing, biggest and otherwise noteworthy mining company exchange-traded funds (ETFs) on the market. Our series begins with PureFunds ISE Junior Silver ETF (SILJ).
SILJ is a fund that focuses on small-cap silver mining and exploration companies. These potentially overlooked companies may have greater potential to pull in big gains in the event of a continued flight to safety in precious metals. Like gold, silver is valued both for its industrial uses and what is seen as its intrinsic value. Whether used for investment, jewelry, industrial purposes or an alternative currency, the demand for silver is growing and the mining companies held in this fund stand to benefit. In addition, the fund’s recent performance is especially impressive, even among mining ETFs.
So far in 2016, SILJ has soared 140%, while the benchmark S&P 500 fund, SPY, has gained only 0.87%. In the world of ETFs, a gain of 140% in just four months is almost unimaginable. For the past 12 months, SILJ has gained 58%, while the S&P has dipped. This fund does not pay dividends and charges 0.69% as an expense ratio, but investors this past year certainly were not disappointed with their return.
Top holdings for this fund include First Majestic Silver Corp. (AG), 16.54%; Pan American Silver Corp., 11.69%; Mag Silver Corp., 10.91%; Coeur Mining Inc., 5.69%; and Silvercorp Metal Inc., 5.67%. This fund has a very large stake in Canadian companies, which comprise a majority of its portfolio, with smaller allocations to U.S. and U.K. mining companies.
The year thus far has been phenomenal for silver and silver mining stocks. If you suspect this trend might continue, PureFunds ISE Junior Silver ETF (SILJ) could be a powerful place to put your investment dollars.
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As always, I am happy to answer any of your questions about ETFs, so do not hesitate to send me an e-mail. You just may see your question answered in a future ETF Talk.