## Silver Price Breaks Through $64.6! Taiwanese Retail Investors Rush into Silver ETFs, How to Choose 7 Popular Funds?

**Silver Prices Hit Record Highs, This Rally Is Not Simple**

The silver market remains hot at year-end. London spot silver surged past $60 per ounce on December 9, driven by expectations of Fed rate cuts, tight global supply, and the inclusion of silver in the critical minerals list, reaching a peak of **$64.6/oz**, the highest on record.

Since the beginning of the year, silver has gained over **100%**, becoming the most eye-catching asset for 2025. This increase far surpasses gold's 60% rise and outperforms the Nasdaq's 20%. International investment bank UBS is optimistic about the future, raising its 2026 target price to the $58–$60 range, and even not ruling out a challenge to **$65/oz**.

Faced with this silver boom, many Taiwanese investors are seeking entry channels. Compared to the hassle of physical silver bars, **Silver ETFs** have quickly become retail investors’ first choice due to their convenience and liquidity.

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## What Is a Silver ETF? Why Is It Better Than Physical Silver?

Simply put, **a silver ETF is an investment fund that tracks the silver price**. It allows you to participate in the silver market without holding heavy silver bars. ETFs are listed on stock exchanges, traded like stocks, with high liquidity.

**The mechanism is actually simple**: ETFs either hold physical silver directly or track silver prices through derivatives like futures. If silver prices rise 5%, the ETF value also increases 5%; if silver falls, the ETF declines accordingly. This mechanism ensures the fund’s price stays synchronized with the market.

**Physical silver looks tangible but is super inconvenient to operate.** You need to rent safety deposit boxes or pay storage fees, and worry about oxidation, theft, or damage. Buying and selling require finding reputable dealers, paying 5-6% spreads, and the transactions are opaque with poor liquidity. If you need cash urgently, you might not be able to sell quickly.

Silver ETFs eliminate these hassles. Just open a brokerage account, place orders like stocks, and you can settle the same day. Since you can track silver prices and buy or sell at any time, why bother with physical silver?

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## Top 7 Popular Silver ETFs Overview

What silver ETFs can Taiwanese investors access? What are their features?

**SLV (iShares Silver Trust)** — The world’s largest silver ETF, managing over $30 billion. Launched in 2006 by Blackrock, it holds physical silver, with a management fee of 0.50%, the cheapest. It’s passively managed, not actively trading, only periodically selling small amounts of silver for operational costs. If you want the purest silver exposure, SLV is the top choice.

**AGQ (ProShares Ultra Silver)** — This is a 2x leveraged ETF aiming to double the silver price gains. It uses futures contracts for leverage, with a fee of 0.95%. But note, leveraged ETFs are only suitable for short-term trading; long-term holding can erode returns due to compounding. Suitable for experienced investors wanting to amplify short-term gains.

**ZSL (ProShares UltraShort Silver)** — This is an inverse leveraged ETF providing -2x returns. Simply put, if silver drops 10%, ZSL rises 20%. The fee is also 0.95%. It’s purely a hedging or bearish tool, only for short-term trading.

**PSLV (Sprott Physical Silver Trust)** — Launched in 2010, a closed-end fund with about $12 billion in assets. Unlike typical ETFs, it issues a fixed number of units, and the trading price is determined by supply and demand, often at a premium or discount. Unique feature: investors can redeem physical silver, attracting long-term holders. Fee is 0.62%.

**SLVP (iShares MSCI Global Silver and Metals Miners)** — Invests in global silver mining companies, not physical silver. Tracks the MSCI index, with a low fee of 0.39%, pays dividends semi-annually. Since 2025, it has gained about 142%, outperforming silver’s price increase, but with higher volatility and additional risks from company operations and policies. Bid-ask spreads are larger, less suitable for frequent trading.

**DBS (Invesco DB Silver Fund)** — Tracks silver via COMEX futures, with a fee of 0.75%. Pure futures-based, more direct but with rollover costs.

**Taiwan-listed ETF (00738U, Dow Jones Silver Excess Return Index ETF)** — Launched in 2018, tracks the Dow Jones Silver Excess Return Index. Uses COMEX futures, with a fee of 1%, classified as a high-volatility product. Its advantage is that it can be bought directly with TWD, avoiding remittance issues, but it carries higher risk.

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## How Do Taiwanese Investors Buy? Discretionary Trust vs. Overseas Brokers

**Discretionary Trust: The Safest and Most Convenient**

This is the choice for most Taiwanese. Through domestic brokers (Fubon, Cathay, Yuanta, Yuanta, etc.), you delegate trading to overseas brokers.

Simple process: open an account online → choose TWD or foreign currency settlement → search code (e.g., SLV) via app → execute trade. Many brokers also support regular fixed investments.

Advantages: regulated by the Financial Supervisory Commission, safe; tax and dividend withholding handled by the broker; funds stay in Taiwan, low remittance risk; Chinese interface, friendly to beginners.

Disadvantages: higher transaction fees, limited product selection. Commissions are usually 3-5 times higher than overseas brokers, which can eat into long-term returns.

**Overseas Brokers: Lower Fees, More Products, Self-Managed**

Open an account directly with overseas brokers (e.g., Interactive Brokers, Firstrade), cutting out middlemen and reducing costs significantly.

Required documents: passport, ID card, proof of address, bank info. Remittance is more complicated—must set up a designated account, convert TWD to USD via wire transfer. After opening, trade via app or web platform.

Advantages: very low commissions (many free or fixed low fees), global product selection, advanced tools like options or margin trading.

Disadvantages: English interface, may be challenging for beginners; 30% US dividend withholding tax, need to file for tax refunds (only if annual overseas income exceeds NT$1 million); transferring funds abroad involves security and estate issues, with less legal protection in Taiwan.

**Summary: Beginners or small capital use discretionary trust for safety; larger capital or experienced traders use overseas brokers to save costs.**

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## Do You Pay Tax on Silver ETF Investments?

Many ask this. The answer depends on whether you buy Taiwanese or overseas ETFs.

**Taiwan-listed silver ETFs (like 00738U)** — Treated as domestic stocks, exempt from tax on purchase; **0.1% transaction tax on sale**. Simplest tax-wise.

**Overseas-listed silver ETFs (like SLV)** — Considered foreign property, subject to overseas income tax. If total overseas income ≤ NT$1 million annually, not included in minimum tax base; over that, fully included. If exceeding NT$7.5 million exemption, taxed at 20%.

Most silver ETFs do not pay dividends (since they track physical or futures), so US withholding tax is minimal. Less dividend means fewer tax issues.

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## Silver ETF vs. Physical Silver, Futures, Mining Stocks: Who Earns the Most? Who Has the Least Risk?

Curious about the different ways to invest in silver? Let’s look at actual 2025 performance.

**Silver ETF**: Easy to buy/sell, high liquidity, no storage needed, low fees, suitable for quick entry/exit. Drawback: fees erode long-term returns, tracking errors exist, no physical ownership. In 2025, net returns slightly below 100% silver price increase.

**Physical Silver Bars**: Actual ownership, crisis protection, no counterparty risk, high privacy. But storage costs (1-5% annually), theft risk, poor liquidity, 5-6% premiums and commissions, transportation and verification hassles. Silver price rose 103% in 2025; after costs, net return about 95-100%. Suitable for long-term hold without trading.

**Silver Futures**: High leverage amplifies returns, flexible for long/short hedging, no storage issues. But high risk, leverage can wipe out principal, complex to monitor rollover, high transaction costs. If correct on direction, 2x leverage can yield over 200%; wrong direction, losses are magnified. Suitable only for experienced traders.

**Silver Mining Stocks (e.g., SLVP)**: Leverage effect during silver rallies, diversified, easy to trade, some pay dividends. But not pure silver exposure, affected by company operations, policies, with higher volatility and company-specific risks. In 2025, mining ETF gained about 142%, far exceeding silver’s rise, but with higher risk.

**Summary**: Beginners prefer ETFs for stability; experienced traders use futures for speed; long-term investors may choose physical silver or mining stocks.

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## 3 Major Risks of Investing in Silver ETFs You Must Know

Don’t get blinded by silver price rallies. While silver ETFs are convenient, risks are real.

**Risk 1: Silver Price Volatility Is Huge** — Silver fluctuates much more than gold or stocks. In 2025, over 100% gains are impressive, but history shows sharp corrections, with short-term drops of 30-50%. Not a stable asset, suitable only for high-risk tolerance investors.

**Risk 2: Tracking Error in ETFs** — Futures-based ETFs are affected by rollover costs, often underperform spot prices over the long term; physical ETFs have annual fees of 0.4-0.5%, eroding returns. Buying an ETF doesn’t mean perfect tracking; actual returns may be lower.

**Risk 3: Currency and Tax Risks for Overseas ETFs** — Silver is priced in USD; exchange rate fluctuations impact TWD returns. Overseas income over NT$1 million must be included in minimum tax base; silver prices are also influenced by geopolitics, industrial demand (solar, electronics), and central bank policies, adding variables.

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## Conclusion: Who Is Suitable for Silver ETFs?

If you want to participate in the silver market without moving silver bars, researching futures, or risking full leverage, silver ETFs are a good choice. They are standardized financial products with high liquidity, trading convenience, and transparent costs.

But remember, silver is inherently volatile; it’s not a hedge or a stable asset. Diversify your portfolio, review positions regularly, and avoid over-concentration. If high commissions bother you, consider overseas brokers; if tax issues concern you, buy domestic ETFs.

Silver prices reaching $64.6 is a hot market this year. But the most important thing in investing is to understand the risks and know what you’re doing.