Silver prices soar to historic highs! Silver ETFs become the new favorite among retail investors. An article explaining how to buy and how to choose.

Silver Bank Sentiment Sparks Investment Frenzy in 2025. The latest spot price has surged to a historic high of $83.645 per ounce, with an annual increase of over 140%, making it one of the most remarkable assets performance-wise. This rally far outpaces gold and tech stocks, prompting many investors to seriously consider getting involved.

In response to this surge in silver prices, Silver ETFs have quickly become the most convenient entry point for retail investors. Compared to the hassle of physical silver, ETFs allow investors to participate as easily as trading stocks through their brokerage accounts. However, before deciding to buy, you need to understand the market mechanism, risks, and options.

Why Are Silver Prices Rising So Rapidly? Clarifying the Underlying Market Logic

Multiple factors are driving this silver price increase: expectations of Federal Reserve rate cuts, tight global silver supply, strong industrial demand (solar, semiconductors, etc.), plus the U.S. government officially listing silver as a critical mineral. These factors combine to create strong upward momentum.

But investors should also note that CME has consecutively raised margin requirements twice to curb excessive speculation. The latest adjustment was announced on December 26, raising the initial margin for March 2026 silver futures from $22,000 to $25,000, a 25% increase. This intervention caused silver prices to retreat from highs to the $70-75 range, reflecting regulatory concerns over market overheating.

What Exactly Is a Silver ETF? A Simple Explanation for Quick Understanding

Silver ETFs are investment funds that track silver prices, allowing you to participate in silver price movements without physically holding bars of silver. They are listed on stock exchanges and can be bought and sold like stocks at any time.

The operation is straightforward: most hold physical silver bars directly or track silver prices via derivatives like futures contracts. When silver prices rise by 5%, the ETF’s value also increases by about 5%; when prices fall, the ETF declines similarly.

Compared to physical investment, ETFs eliminate storage, insurance, and theft concerns. You don’t need to worry about silver being stolen, oxidized, or damaged, nor do you need to find a silver dealer or miner to verify purity. Liquidity is also much higher.

How to Choose Silver ETFs? An Overview of 7 Popular Options and Their Pros and Cons

There are many silver ETFs available, each with its own features. Here are some mainstream products investors often encounter:

SLV (iShares Silver Trust)

• The most well-known silver ETF globally, with assets over $30 billion
• Holds physical silver directly, custodied by JPMorgan
• Management fee 0.5%, passive management
• Suitable for long-term allocation

AGQ (ProShares Ultra Silver)

• Provides 2x leverage, tracking daily silver performance
• Management fee 0.95%
• Key point: Due to compounding decay, suitable only for short-term trading, not long-term holding

ZSL (ProShares UltraShort Silver)

• Offers 2x inverse leverage (-2x return)
• Suitable for bearish views on silver or hedging
• Also only for short-term trading

PSLV (Sprott Physical Silver Trust)

• Closed-end fund with about $12 billion in assets
• Unique advantage: investors can redeem ETF units for physical silver
• Trading price can deviate from net asset value (premium or discount)
• Suitable for long-term investors who want eventual physical ownership

SLVP (iShares MSCI Global Silver and Metals Miners)

• Invests in major global silver mining companies
• Management fee 0.39%, low-cost industry-wide
• Drawbacks: higher volatility, tracking errors, large bid-ask spreads
• 2025 performance approximately +142% (outperforming silver price increase), but with higher risk

台灣期元大道瓊白銀（00738U）

• Taiwan-listed silver ETF tracking the Dow Jones Silver Excess Return Index
• Uses COMEX silver futures for tracking
• Issue price NT$20, classified as a high-volatility product
• Management fee 1%

How Can Taiwanese Investors Buy? Comparing Two Main Channels

Channel 1: Discretionary Trading via Domestic Brokers (Recommended for Beginners)

Trade through domestic brokers (Fubon, Cathay, Yuanta, Yuanta) with overseas brokers.

Process:
Open a discretionary trading account → Choose TWD or foreign currency settlement → Place orders via broker app → Search ETF code (e.g., SLV)

Advantages:
Regulated by the Financial Supervisory Commission; high safety; tax issues handled by broker; funds stay in Taiwan

Disadvantages:
Higher transaction fees; limited tradable products

Channel 2: Direct Overseas Broker Account (Lowest Cost)

Open an account online, saving on middleman fees.

Process:
Online account opening (prepare passport, ID, etc.) → Wire transfer funds → Use app to place orders

Advantages:
Very low or zero commissions; full product range; supports advanced trading tools

Disadvantages:
Some interfaces in English; need to handle tax reporting yourself (e.g., 30% withholding on US dividends); complex procedures if funds need to be transferred abroad

Do You Need to Pay Taxes on Silver ETF Transactions? Understanding Taiwan’s Tax Rules

Taiwan-listed silver ETFs (e.g., 00738U):
Buying is tax-exempt; selling incurs a 0.1% tax, the simplest tax scenario.

Overseas silver ETFs (e.g., SLV):
Regarded as overseas property transaction income, included in overseas income. Rules are as follows:

• Total overseas income ≤ NT$1 million: not included in minimum tax calculation
• Over NT$1 million: fully included in basic income
• Tax rate: after deducting NT$7.5 million exemption, the excess is taxed at 20%

Comprehensive Comparison of Silver Investment Methods: ETF vs Physical vs Futures vs Mining Stocks

Different silver investment methods have their own pros and cons. Choose based on your capital, risk tolerance, and trading frequency:

3 Major Risks and Precautions You Should Know

1. Silver Price Volatility Far Exceeds Gold and Stocks

In 2025, over 140% increase, but history shows sharp corrections. After margin adjustments on December 29, silver once plunged over 11% in a day, causing significant losses for many. The daily price limits for silver ETFs vary across markets; always check exchange rules before trading.

2. Tracking Errors in ETFs Cannot Be Ignored

Futures-based ETFs suffer from roll costs, potentially underperforming spot over time; physical ETFs with 0.4-0.5% annual fees gradually erode returns.

3. Overseas ETFs Carry Currency and Tax Risks

Silver prices are also affected by geopolitical events, industrial demand, and monetary policies. When choosing overseas ETFs, consider USD exchange rate fluctuations and tax reporting costs.

Final Investment Advice

From an asset allocation perspective, silver ETFs are the most convenient way to participate in the silver market. They combine liquidity and trading flexibility while avoiding the storage hassles of physical silver. But remember, silver prices are highly volatile and influenced by industrial demand and market sentiment.

It’s advisable to diversify your holdings, avoid over-concentration in a single asset, and regularly review market changes and your positions. Regardless of the investment method chosen, risk management should always be the top priority.