How to choose silver ETFs? An essential entry guide for Taiwanese investors

Silver prices are on an unstoppable rally. London spot silver broke through $60 per ounce on December 9th this year, driven by expectations of Federal Reserve rate cuts, global supply tightness, and the U.S. officially listing silver as a critical mineral. Since then, it soared to a record high of $64.6/oz. This year’s increase has exceeded 100%, far surpassing gold’s 60% rise and outperforming the Nasdaq index by about 20 percentage points.

UBS has also raised its 2026 silver target price to the $58–$60 range, with the possibility of reaching $65/oz. During this rally, Silver ETFs have become a popular channel for retail investors due to their low entry barriers and flexible trading.

Understanding Silver ETFs Before Investing

What is a Silver ETF? Simply put, it’s a fund that tracks the price of silver, allowing you to participate in silver market movements without holding physical bars. It’s traded on stock exchanges like stocks—buy or sell at will, with much higher liquidity than physical silver.

How do Silver ETFs operate? Fund managers hold physical silver bars directly or track silver prices through futures and derivatives. When silver prices go up 5%, your ETF also rises 5%; vice versa.

Physical Silver Bars vs. ETFs: Which to Choose? Holding real silver provides a sense of security, but it’s cumbersome to manage. Storage fees, insurance, anti-oxidation measures, and the difficulty of quickly selling or bargaining for better prices make liquidity slow. In contrast, Silver ETFs can be traded anytime via brokerage accounts, eliminating these hassles—much more convenient for investors in Taiwan.

How to Pick Among 7 Popular Silver ETF Funds?

SLV (iShares Silver Trust) is the most well-known global silver ETF, managed by BlackRock, with over $30 billion in assets. It holds physical silver directly, with a 0.50% expense ratio, tracking the LBMA silver price, and employs passive management—buying and selling infrequently.

AGQ (ProShares Ultra Silver) offers 2x leverage, with a 0.95% expense ratio, suitable for short-term traders seeking amplified returns. But beware—leveraged products suffer from compounding decay and are only suitable for short-term use, not long-term holding.

ZSL (ProShares UltraShort Silver) is a 2x inverse leveraged ETF, allowing profit when silver declines. Also only for short-term trading; long-term holding can be eroded by compounding effects.

PSLV (Sprott Physical Silver Trust) stands out because holders can redeem silver in physical form, appealing to long-term believers in silver. It has a 0.62% expense ratio and about $12 billion in assets. Note that it’s a closed-end fund, so its trading price can sometimes deviate from net asset value, leading to premiums or discounts.

SLVP (iShares MSCI Global Silver and Metals Miners) invests in global silver mining companies, with the lowest expense ratio at 0.39%. It gained 142% by 2025, outperforming the pure silver price increase of 103%. However, it carries higher risks related to company operations, regulations, and policies—not just silver price movements.

期元大道瓊白銀（00738U） is a Taiwan-listed option, investing in futures tracking the Dow Jones Silver Excess Return Index, with a 1% fee. It’s rated as high volatility, suitable for experienced investors.

How to Buy? Direct Order or Entrustment?

Using a securities firm (indirect) is most convenient—through domestic brokers (Fubon, Cathay, Yuanta, Mega, etc.) to place orders with overseas brokers. Ideal for beginners. Account opening is simple, with Chinese interfaces, tax handled by the broker, and no need to transfer funds abroad. The downside is higher transaction fees and limited available products.

Opening an overseas broker account directly usually costs less—lower or zero commissions, more product choices. But it involves English interfaces, remittance procedures, and self-managed tax reporting. If concerns about fund security or inheritance arise, handling can be more complex, and there’s less legal protection under Taiwanese law.

Do I Need to Pay Taxes When Buying?

For Taiwanese-listed silver ETFs (like 00738U), the simplest is tax-free purchase, with only 0.1% transaction tax upon sale.

For overseas silver ETFs, it’s more complicated. Taiwan considers it as overseas property transaction income, included in foreign income. If total overseas income is ≤NT$1 million annually, it’s tax-exempt; over that, it’s combined with basic income and taxed at 20%. If you also have US dividends or other overseas income, it should be consolidated—consult an accountant or the tax bureau for specifics.

Silver ETF vs. Other Investment Methods

Physical silver bars have gained about 103%, tracking silver prices, but after storage fees and bid-ask spreads, net returns are around 95–100%. Suitable for long-term insurance-like holding, not for short-term trading.

Silver futures with 2x leverage can yield over 200% returns if the market moves correctly, but if wrong, you can lose your entire principal. Very high risk—only for experienced traders.

Silver mining stocks like SLVP can rise 142%, outperforming pure silver, but face operational, cost, and policy risks—not just silver price movements.

Silver CFDs allow small-scale leveraged trading with flexible entry and exit, and lower fees than futures. But leverage also increases risk—be cautious, especially for beginners.

Essential Risks to Know Before Investing

Silver price volatility is fierce—much more than gold or stocks. A 100%+ rally sounds great, but history shows sharp corrections are common. Short-term losses are also possible during this rally.

Tracking errors—futures-based ETFs suffer from roll-over costs, potentially underperforming spot silver over the long term. Physical silver ETFs are more accurate but have annual fees of 0.4–0.5%, which gradually eat into returns.

Currency and tax concerns—overseas ETFs are affected by USD fluctuations (e.g., AUD/CNY exchange rates). Silver prices are also influenced by geopolitics, industrial demand, and central bank policies.

Conclusion

Silver ETFs are a good option for those wanting exposure to silver without dealing with physical bars—trading is convenient and liquidity is high. But silver prices are easily affected by industrial demand and speculative sentiment, and different ETFs have varying fees and tracking methods. Instead of putting all your eggs in one basket, diversify and review your holdings regularly. For those with limited risk tolerance, choose funds with low fees and minimal tracking error; more aggressive investors can explore leveraged products. Finding the right entry method and strategy is key to long-term profits.