A Small Silver Fund with a Big Return

Doug Fabian

Doug Fabian is known for his expert knowledge of ETFs, bear funds and enhanced index funds to profit in any market climate.

A relatively small exchange-traded fund (ETF) with a silver-mining niche that is worth bringing to your attention is the iShares MSCI Global Silver Miners ETF (SLVP), a fund with just $44 million in total assets.

Its size pales in comparison to the VanEck Vectors Gold Miners ETF (GDX), also known as the Market Vectors Gold Miners ETF, which I featured in my previous ETF Talk to highlight its status as a $7 billion gold mining fund that invests in large-cap companies to reduce risk and provide stable returns for its investors compared to other precious metals ETFs. SLVP, on the other hand, invests in silver mining companies throughout the world and holds a portfolio of 36 different positions.

However, SLVP’s top two companies, Silver Wheaton Corporation (SLW.TO) and Fresnillo PLC. (FNLPF.L), together comprise more than a quarter of the fund’s assets, at 18.14% and 8.76%, respectively. Going down the list of holdings, the portfolio also includes Tahoe Resources Inc. (TAHO.TO), 7.97%; First Majestic Silver Corporation (AG.TO), 5.88%; Buenaventura Mining Company Inc. (BVN), 4.99%; Hecla Mining Company (HL), 4.71%; and others.

Year to date, SLVP has performed outstandingly, posting a gain of 95.25%. Put side-by-side with the S&P 500’s year-to-date gain of 2.26%, SLVP’s performance can only be described as impressive.

As you can see from the chart below, SLVP started the year off slowly, but soared during the most recent three months. In fact, its return for the last 100 days is 88.89%. Even in just the last month it has risen 40.1%. The fund pays a 0.35% dividend yield and its expense ratio is 0.39%.

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View the current price, volume, performance and top 10 holdings of SLVP at ETFU.com.

The idea behind SLVP is to invest in companies whose performances are closely linked to the underlying price of silver. What this means is that when silver prices increase, investors will most likely see a bigger increase in their returns from SLVP. Since SLVP invests in different companies around the world, it is exposed to additional risks, such as currency risks and local risks for each of its companies.

Essentially, investing in SLVP could be ideal for those who are bullish on silver and are seeking a magnified gain from it. If this sounds like you, I encourage you to research the iShares MSCI Global Silver Miners ETF (SLVP) further.

If you want my advice about buying and selling specific ETFs, including appropriate stop losses, please consider subscribing to my Successful ETF Investing newsletter.

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.

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