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How To Get 2% Discount On Gold And Silver, 11% On Miners And 11% Dividend


  • 2.1% discount on physical gold and silver.
  • 10.82% discount on mining stocks.
  • 11.03% dividend from option strategies.

This series of articles does not aim at predicting where precious metal prices will go, but at showing investors where they can get more value for their money.

Since my last update one month ago, gold is close to the same price after a failed attempt to break out above $1300.

Gold price weekly chart at Finviz

In 2017, gold was most of the time between $1200 and $1300, two levels that have played many times as support, resistance and magnet since 2013. We’ll see what happens in the historically good season for precious metals: November to February.

The short interest of commercial hedgers is high but not extreme, giving little clue on gold insiders' sentiment. The situation is similar for silver and platinum. It is different for palladium, touching a 17-year high for the second time in a few weeks, with a short interest of commercial hedgers approaching a multi-year extreme value.

Palladium monthly chart (finviz.com)

I don’t know if it is a good time to buy precious metals as an investment, but there is no bad time to accumulate small amounts as an insurance. For this purpose, some closed-end funds are an alternative to GLD, SLV, PPLT and PALL. The next table shows the discounts for some Canadian funds on 10/31/2017.


+Premium -Discount

Expense ratio

Central Fund of Canada




Sprott Physical Gold Trust




Sprott Physical Silver Trust




Sprott Physical Platinum & Palladium Trust




Premiums and discounts are calculated with the price of latest LBMA fixing (12:00 p.m. for silver, 3:00 p.m. for gold).

CEF will be bought by Sprott and assets should be transferred to a new Sprott fund under a new ticker at some point in the 1st quarter

This article was written by

Fred Piard profile picture
Author of Quantitative Risk & Value and three books, I have been investing in systematic strategies since 2010. I have a PhD in computer science, an MSc in software engineering, an MSc in civil engineering and 30 years of professional experience in various sectors. My aim is making simple and efficient quantitative investing techniques available to my followers. Quantitative models can make investment decisions faster, reproducible and emotionless by focusing on relevant information in the middle of market noise. Moreover, models can be refined to meet specific risk tolerance and objectives. 

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I am an individual investor and an IT professional, not a finance professional. My writings are data analysis and opinions, not investment advice. They may contain inaccurate information, despite all the effort I put in them. Readers are responsible for all consequences of using information included in my work, and are encouraged to do their own research from various sources.

Analyst’s Disclosure: I/we have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (16)

are you planning to do an update of this article ? Would be interesting now that gold and silver have seen some upward trend . I see that the discount on ASA is still substantial . What is the best way to invest in Platinum ?
Been a long term holder of CEF. Plan to sell After acquisities of Sprott o just before when premium is close to zero. I do not want to pay the higher expense on Sprott.
May put part of the proceed into ASA .
Suggest to look for alternatives for Cef apart from Sprott for your overview.
Fred Piard profile picture
Thanks for reading Jan. Personally I hold shares of Zuercher Kantonal Bank metal funds, but I think US persons are not allowed to buy them.
That ok for me. Living in Belgium. Investing with a company in the Netherlands. What is the ticker and what is the expense ratio.. I assume no discount?
Fred Piard profile picture
Tickers on SWIX for all metals in CHF: ZGLD, ZSIL, ZPLA, ZPAL. You have variants in USD, EUR, GBP and also hedged against the currencies. Just don't take the hedged versions if you want plain metal. You should find more info on zkb.ch. I think ER is also 0.40% for gold. Not cheaper than Sprott, but gold is stored in Switzerland.
The 1.26% MER is burned up in what, 6-7 years by that discount?
Fred Piard profile picture
I guess you are pointing to ASA expense ratio. It must be compared with a similar product and your calculation should take the difference. GDX is at 0.52%. I have no position in any of these funds. Last time I have bought GGN it was at a 2-digit discount, I sold it a few months later after the price went up and the discount had shrunk, unlocking additional value. I don't see closed end funds as buy-and-hold instruments.
This seems oddly promotional under the circumstances of current expectations for the precious metals. I am fairly confident that "the market" would not be offering for sale at a discount any item that it expects to rise in price in a relevant time frame. An expectation that gold will rise materially in the foreseeable future, and not decline, is an arrogant posture that ignores the probabilities presented by the markets.
Fred Piard profile picture
Franklin, I don't know about your "current expectations for the precious metals", but if you have read somewhere that "gold will rise materially in the foreseeable future", it is not in this article.
User 37220206 profile picture
Fred, thank you for this article, But can you be a bit more specific on the title of your piece: "How To Get 2% Discount On Gold And Silver, 11% On Miners And 11% Dividend"
MountainMan1776 profile picture
Seems obvious where the title came from if you read the piece ...
- 2% discount on gold / silver with CEF
- 11% discount on miners with ASA
- 11% dividend with GGN
arihalli profile picture
User 372 had tongue-in-cheek?
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