Silver prices hit a new high! The complete guide for Taiwanese investors to jump into silver ETFs

Gold prices are making history. Driven by multiple positive factors such as the Federal Reserve’s rate cut expectations, global supply chain tensions, and silver being listed on the U.S. critical minerals list, London spot silver broke through $60 per ounce on December 9, 2025, and subsequently climbed to a record high of $64.6/oz. Year-to-date gains have exceeded 100%, making it the most outstanding asset performance, far surpassing gold by over 60% and leading the Nasdaq Composite Index by about 20%. International investment bank UBS has set its 2026 target price at $58 to $60 per ounce, with the possibility of rising to $65/oz.

In this rally, Silver ETFs have become the preferred tool for retail investors, but how to choose and operate them to avoid pitfalls? This article will comprehensively analyze the investment logic of silver ETFs.

What exactly are Silver ETFs? How do they differ from physical silver?

Silver ETFs are investment funds that track silver prices, allowing investors to participate in the market without holding physical silver. These products are listed on stock exchanges and traded just like stocks, enabling investors to buy and sell anytime during trading hours.

The operation is simple: Silver ETFs hold physical silver bars or use futures and derivatives to track silver prices. If silver prices rise by 5%, the ETF value also increases by about 5%; vice versa.

Compared to the hassle of buying physical silver—such as storage, insurance, anti-oxidation, authenticity verification—silver ETFs eliminate these burdens. Physical trading involves large bid-ask spreads (often 5-6%), low liquidity, and difficulty liquidating quickly in urgent sales; ETFs, on the other hand, offer high liquidity, transparent pricing, and the ability to buy or sell at any time.

Risks must be understood in advance

Before investing in silver ETFs, you must understand their risk characteristics:

Silver price volatility far exceeds expectations: Silver prices are much more volatile than gold and stocks. Although the 2025 rally exceeded 100%, historical data shows sharp corrections are common, which could lead to significant short-term losses.

Tracking error exists objectively: Futures-based ETFs are affected by roll costs, and long-term returns may be lower than spot silver prices; physical ETFs have annual fees of about 0.4-0.5%, which gradually eat into returns.

Exchange rate and policy risks: Overseas ETFs face currency fluctuations, and silver prices are also influenced by geopolitical factors, industrial demand (solar energy, electronics manufacturing), and central bank policies.

Comparison of 7 popular silver ETF products

Deep analysis of each product:

SLV is the industry benchmark, managed by BlackRock, listed since 2006. Its assets consist of physical silver stored in Morgan Chase’s custody, following a passive strategy, not actively trading silver, only periodically selling small amounts to cover operational costs.

AGQ and ZSL are leveraged products with short-term trading characteristics. AGQ aims to achieve twice the daily return of the Bloomberg index, while ZSL provides -2x inverse returns. The effects of compounding and time decay make them unsuitable for long-term holding.

PSLV is a closed-end fund with a fixed issuance unit, and its trading price is determined by market supply and demand, often showing premiums or discounts. As one of the largest physical silver closed-end funds, it offers pure exposure to physical silver.

SLVP covers global silver exploration and mining companies, tracking the MSCI index passively. Although it has the lowest management fee (0.39%), tracking errors are evident, with higher volatility and wider bid-ask spreads, making it less attractive.

Futures Yuan Avenue Dow Jones Silver (00738U) is the only option listed in Taiwan, established in 2018, investing in COMEX futures contracts, with a high volatility risk level.

How should Taiwanese investors get started?

Via Discretionary Trust: The safest choice

Using domestic brokers (Fubon, Cathay, Yuanta, Yuanta, etc.) to execute trades through overseas brokers is the preferred method for most beginners.

Process:

• Open a discretionary trust account with a broker (online or in person), prepare ID card and bank account
• Choose settlement in TWD or foreign currency
• Place orders via app or website, enter ETF code (e.g., SLV) to buy, support regular investment

Advantages and disadvantages: Regulated by the Financial Supervisory Commission, high security; tax handled by the broker; funds stay in Taiwan, no remittance needed. Drawbacks include higher handling fees and limited tradable products.

Overseas brokers: a lower-cost alternative

Open an account directly on an overseas broker platform, saving middleman fees and reducing trading costs.

Process:

• Complete online account opening, prepare passport, ID, proof of address, bank info
• Transfer TWD to USD via wire transfer (set up designated account)
• Use app to place orders, search for codes directly

Advantages and disadvantages: Very low or zero commissions; wide range of products; supports margin trading and advanced tools. Disadvantages include handling English interfaces, tax reporting, cumbersome remittances, and lack of Taiwanese legal protection.

How to handle taxes? Know this in advance

Taiwan-listed silver ETFs (like 00738U) have simple tax treatment: no tax on purchase, only 0.1% on sale.

U.S.-listed silver ETFs (SLV, AGQ, etc.) are considered foreign property transactions. Tax thresholds: if total overseas income ≤ 1 million TWD annually, no minimum tax; exceeding 1 million TWD, all is included in basic income. Over 7.5 million TWD, taxed at 20%.

Additionally, if the ETF distributes dividends (most do not), the U.S. will withhold 30% tax, which must be claimed back via U.S. tax refund procedures.

Silver ETFs vs. other investment methods: pros and cons

Although silver ETFs’ returns are lower than futures or mining stocks, they are relatively safer, more accessible, and free from physical management burdens, making them more suitable for beginners and small to medium investors.

Final investment decision reminder

Silver ETFs are attractive asset allocation tools, but silver prices are highly volatile, easily influenced by industrial demand and market speculation. Different silver ETFs vary significantly in fees, tracking methods (leverage or physical holding).

Investors are advised to diversify, avoid over-concentration, and regularly review market trends and positions. Choose products according to risk tolerance—beginners prefer SLV or Taiwan-listed ETFs, while advanced investors may consider leveraged or mining stocks, but should not ignore the associated risks.