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  • Why Silver ETFs Are Integral To Your Portfolio? 0 comments
    Mar 16, 2013 6:53 AM

    Investing in Silver; which has been a done thing in most portfolios, is bound to reach a climax in short terms as all market pointers are decisively hinting at an outbreak. The aberration between the output and consumption is testing the historical highs and Physical Silver Metal is seriously becoming scarce. Those who consider the current white metal deficit to be a capitalistic hoax must try buying a simple one ounce silver medallion in a market where most credible selling agencies are charging as much as thirty percent premium on the spot prices, but even with this price anomaly, supplies are still limited towards the retail end users or customers who want to buy small quantities of the white metal.

    Silver Miner ETFs is yet again a good choice for foreign investors, as these funds will give you a well equated stake among most major Silver Mining companies listed anywhere in the world and the safety is mandated as per the regulations of bona fide Indices that they follow.

    Miners are historically known to outperform the gains from the physical metal, in almost all previous instances of a rally and the biggest thing that works in their favour is The First Movers Advantage and a fact that when the commodity prices surge, they very well cover the otherwise under stress mining costs resulting in immediate profit posting to be shared among the stakeholders of these Silver Mining Securities.

    A well placed investment in Silver isonly logical as it has been observed in many bull market rallies that the price has either tripled or even risen four times while the same time gold metal prices only doubled. Strengthening this claim one can lay emphasis on the industrial usages of silver that outnumber the uses of gold.There have been instances of the former metal's industrial demand exceeding the production and recovery dynamics, there by pushing the prices up.

    Apart from industrial uses, Silver is used in dentistry, making coinage, photography, jewellery, electronics, optics, mirrors, cleansing process of water and medicines.

    The largest mines are located in Mexico, Peru, Chile and China. In developed nations Australia and Canada boast of the biggest mines. Penoles in Mexico and Volcan Compania minera are among the biggest silver mining companies.

    Further there is an associated trend with this metal's prices that cost becomes reasonablewhen the global economy presents better gross domestic product (NYSE:GDP) figures and vice versa. Therefore it means buying Silver ETFs and stocks when globally things are smooth.

    Exchange traded fundsare investment pools that follow a particular bench mark. One such bench mark is the Solactive Global Silver Miners Index that includes stocks of firms involved in mining, exploration and refining work and attuned funds are strict pure plays that offer geographical diversification to an individual's portfolio with the exact allocation as in the Index.

    New York stock exchange (NYSE) and other similar well planned exchanges are the ones where in these ETFS are traded on spot prices.And the fund issuers invest in equities and bullion bars /physical silver; in case of bullion, the investor in reality owns a paper/ certificate representing his (physical) ownership stake.

    Investing in silver ETFs may be considered to diversify your White Metal Portfolio which is again a must have today as a possible weapon against inflation and rising oil prices. Although the market is on its way to factor in the entire rally speculation in to the cost of the metal, however Late Bloomers may still take advantage of this event which in all likelihood will be one of the biggest Wealth Creation Show of our lifetimes.

    Global X Silver Miner ETF [SIL]is attuned its namesake NYSE listed Solactive Index and delivers as per the performance of its 32 stocks of the most traded silver mining fund, Exploration and Refining companies worldwide. With a close to $284million worth of assets under management, this Silver Miners fund has delivered a +30% returns since its inception in April 2009 which is also in tandem with the benchmark returns. Fresnillo, Penoles and Silver Wheaton are the major Silver mining equity that makes the top three assets for the fund and country wise Canada scores over all others with a close to 45% of the holdings of Global X SIL Fund vested there.

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