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Ignore today's dive in Sprott Physical Silver Trust (PSLV -3.8%, with SLV +0.3%) on the back of...

Ignore today's dive in Sprott Physical Silver Trust (PSLV -3.8%, with SLV +0.3%) on the back of about a $200M follow-on offering, writes Brendan Conway. Sprott is simply turning the fund's premium to NAV into cash with which to buy more silver - exactly what an owner of the shares wants to see.
Comments (12)
  • Paulo Santos
    , contributor
    Comments (19519) | Send Message
     
    Nah, a prospective owner might want that. An owner that bought at a premium to NAV? Not so much. But then again, if someone bought at a premium, you can't exactly say they know what they're doing anyway.
    12 Jul 2012, 03:38 PM Reply Like
  • SA Editor Stephen Alpher
    , contributor
    Comments (543) | Send Message
     
    Yes, current owners got burned (like you said they should have known it was trading at a 7% premium), but I think Conway is saying it's too late to sell.

     

    PSLV may go down from here because silver goes down, but not because of the capital raise.
    12 Jul 2012, 03:41 PM Reply Like
  • youngman442002
    , contributor
    Comments (5131) | Send Message
     
    I bought some..I saw the drop ..it happens in CEF too when they do a new offer...usually a good time to add
    12 Jul 2012, 04:00 PM Reply Like
  • montanamark
    , contributor
    Comments (1435) | Send Message
     
    silver held possible double bottom at 26.15-26.10 area
    12 Jul 2012, 04:20 PM Reply Like
  • Luke Skywooker
    , contributor
    Comments (408) | Send Message
     
    I'm getting tired of Silver going nowhere.
    12 Jul 2012, 04:26 PM Reply Like
  • montanamark
    , contributor
    Comments (1435) | Send Message
     
    trade the equities and hold the physical; buy the plunges and sell the rips
    12 Jul 2012, 04:33 PM Reply Like
  • runSILVERrun
    , contributor
    Comments (44) | Send Message
     
    Get used to it because it may be in stall mode for a while. However, patience will pay off. By this time next year silver will be in the 40s, if not 50s. "Good things come to those who wait." Now is not the time to give up on silver especially if you have lost by investing in it. Silver should always be a long-term investment. Short term is a losing battle unless your timing is perfect. Long-term, you will do well.
    12 Jul 2012, 11:36 PM Reply Like
  • winningtrader
    , contributor
    Comments (2476) | Send Message
     
    The one thing to notice is that this is actually a large amount, given the small size of the silver market. The total supply of silver (mining + scrap) is worth ~ $27 billion at current prices, so $200 mm is not a trivial amount. This shows that the demand for silver is actually very strong.
    12 Jul 2012, 05:03 PM Reply Like
  • Paulo Santos
    , contributor
    Comments (19519) | Send Message
     
    The ... speculative ... demand for silver.
    12 Jul 2012, 05:05 PM Reply Like
  • Jim McCraigh
    , contributor
    Comments (162) | Send Message
     
    We posted a recent interview with Eric Sprott regarding the future of gold and silver at http://wp.me/p2esYO-8k
    12 Jul 2012, 05:56 PM Reply Like
  • winningtrader
    , contributor
    Comments (2476) | Send Message
     
    Sprott surely knows silver. Silver is of course a market that is impossible to trade. You just need to buy and wait. You may have to wait a long time but prices will eventually be much higher. Silver is massively undervalued. Not sure how long JPM will be able to rig the market.
    12 Jul 2012, 05:57 PM Reply Like
  • runSILVERrun
    , contributor
    Comments (44) | Send Message
     
    If you can't buy physical silver (clearly the best option) invest in SLV. I have followed it and invested in it for over three years. It is a mirror of physical silver within a few cents.
    12 Jul 2012, 11:37 PM Reply Like
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