Silver ETF Holdings

Silver ETF Holdings

Silver holdings in Exchange Traded Funds (ETFs) remain at near record levels.

Silver ETFs remain a popular way to invest in silver vs. buying and storing physical bullion.

While American Silver Eagle (ASE) coin sales hit a record in 2014, the amount of silver held in iShares silver trust (SLV) is larger than the amount of ASEs sold from 2006-February 2015.

Are ETFs the best way to own silver?

JM Bullion

The Rise of Silver Exchange Traded Funds

Updated March 30 2016

Silver ETF demand march 29 2016

Silver ETF holdings began to rise in the first quarter of 2016.

Silver Exchange Traded Funds have made investing in silver easy. The largest silver ETF iShares silver trust (SLV) was launched in April 2006 and has since grown to hold over 320 million ounces of silver. Silver ETFs have turned owning silver into a trade, causing many to buy and sell silver ETF shares based on market fluctuations. Silver ETFs have also diverted some of the silver investment demand away from physical silver products like American Silver Eagle coins, Canadian Silver Maple Leaf coins and Austrian Silver Philharmonic coins.

Most silver ETFs don’t allow physical delivery for retail investors, rather they provide exposure only to the price of silver. Under silver ETF schemes, holders don’t own silver, they own interests in shares representing silver. If the stock market closes, investors do not have access to their silver ETF shares. In contrast, silver held in vaulted allocated and insured accounts outside the banking system can be accessed without regard to bank or stock exchange closures.

In early December we noted that the world’s largest ETF, iShares Silver Trust (SLV) had been experiencing outflows. Unlike gold ETFs that had been losing holdings since early 2013, Silver ETFs continued to add millions of ounces despite a steadily declining price over the past few years.

The outflows of silver from ETFs have ceased in recent weeks (see charts below).

Silver ETFs

Top Silver ETFs and Close Ended Funds

Here are the top silver ETFs and closed ended silver funds:

Chart showing SLV and the second and third largest silver etfs

SLV is by far the largest silver ETF, for which JPMorgan Chase acts as its custodian.

This chart illustrates the comparative size of SLV silver holdings to the amount of silver delivered on Comex in 2014 and 2013 global silver mining production:

Chart showing slv holdings vs silver mining production and comex deliveries

SLV holds silver that is the equivalent of nearly 40% of the 2013 global silver mining production.

Sales of American Silver Eagles vs. Global Silver Mining Production

In “Silver Coin Demand – A Historical Perspective” we compared the record American Silver Eagle coins sales in 2014 with the amount of silver used to mint U.S. 1964 dated dimes, quarters and half dollars and with the 2013 global silver mining supply.

On an annual basis the amount of silver used to mint ASEs is but a small percentage of the annual global silver mining production.

ounces of silver used in 2014 to mint american silver eagles vs. amount of silver used to mint 1964 dimes, quarters and half dollars, vs the global silver mining production in 2013

The amount of silver used annually to produce American Silver Eagle coins is not significant when compared to annual global mining production.

Sales of American Silver Eagles vs. SLV

The amount of silver used to produce a record amount of American Silver Eagle coins in 2014 is small compared to the total holdings of SLV, the world’s largest silver ETF:

american silver eagle sales vs slv holdings smaulgld chart

Record sales of American Silver Eagle coins in 2014 barely stack up to the amount of silver held in SLV.

Sales of American Silver Eagle coins since 2006, the year SLV was founded, compare more favorably than one year sales. Since 2006, the U.S. Mint has sold approximately 270 million one ounce American Silver Eagle coins. SLV currently holds about 320 million ounces of silver.

Chart showing silver held in SLV vs the amount of american silver eagles sold since 2006

Sales of American Silver Eagles from 2006 are comparable to the amount of silver held in SLV, the most popular silver ETF founded in 2006.

Silver ETFS, Closed Ends Funds and other custodial facilities

The total amount of silver held in ETFs, closed ended funds and other silver custodial facilities as of February 10, 2015 is about 863 million ounces which is roughly equivalent to the annual global silver mining production in 2013.

The Tiny Size of The Silver Market

In “Twelve Differences Between Silver and Gold” we noted the small size of the silver market.

At approximately $17 an ounce, 800 million ounces of silver is worth about $13.5 billion, which is less than the net worth of the top 25 richest individuals and about the same as the price appreciation of Mark Zuckerberg’s Facebook stock from 2013-2014.

Chart showing the amount and value of silver held in ETFs 2009-2015

The amount of silver held in ETFs and other custodial facilities has risen, while the value has fallen.

Silver ETF holdings 2010-2015

silver etf holdings chart showing etf holdings 2010-2015

Total ounces of silver held in ETFs, closed end funds and other custodial facilities have remained elevated despite a drop in the price of silver the past few years.

Silver ETF holdings 1994-2015

Silver ETF holdings chart showing the total holdings of all major silver etfs from 1994-2015

The sharp rise in the amount of silver held in ETFs can be seen starting in 2006, SLV’s first year of operations.

Comex Silver Deliveries and Stock Piles 2006-2014

Comex silver deliveries 2006-2014

Comex silver deliveries and stock piles 2006-2014.

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All charts courtesy of Nick Laird of Sharelynx, other than charts labelled “Smaulgld” which are my own inartful creations.

Sources: Mining supply – The Silver Institute; Comex Silver Deliveries – CME Group; American Silver Eagle coin sales – The U.S. Mint

Further Reading:

Silver ETF outflows

Gold ETFS on the Rise Again

Platinum ETFs

Gold ETFs

Silver Supply and Demand

Gold and Silver Price Manipulation -Suspected

Gold and Silver Manipulation – Actual

12 Ways Silver Is Different Than Gold

Silver Coin Demand a Historical Perspective

Comex Gold Deliveries vs. the Shanghai Gold Exchange

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