On 15/1, Vanda Research released a report indicating that individual investors poured 921,8 million USD into silver-related exchange-traded funds (ETFs), such as iShares Silver Trust, over the past 30 days. The day before, the fund received 69,2 million USD from retail investors. This marks the second highest inflow in the fund's operational history, surpassed only by the 2021 precious metal price surge, known as the Silver Spike 2021.
The price of this ETF's shares has increased by 31,3% this year and 210% over the past 12 months. This performance aligns with the fluctuations in silver prices. The precious metal has consistently set new records since last year, at one point this week exceeding 93 USD per ounce, according to data from LSEG.
The MSCI ACWI Select Silver Miners Investable Index, which tracks silver mining companies, also saw a 225% increase over the past 12 months. This group of businesses is particularly sensitive to precious metal price fluctuations.
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Global silver price movements over the past five years. *Chart: Kitco*
In 2021, the silver market accelerated amid a wave of individual investor speculation in meme stocks. However, according to Vanda, this current surge is supported by more robust factors.
"This is not just a meme stock-style surge. We are witnessing a structural accumulation process. The price now far exceeds the 2021 peak", Vanda commented. The company believes it is time to consider silver a "core macro trading asset", rather than merely a speculative bet.
Last year, silver prices increased by over 160%, primarily due to US recognition as an essential mineral, supply chain shortages, and rising industrial and investment demand. This year, the precious metal's price is expected to reach 100 USD per ounce.
Vanda also noted that individual investors are currently major players in the ProShares UltraShort Silver ETF. This is a leveraged inverse ETF, delivering double the daily price decline of silver.
However, some remain cautious. "We waited 45 years for silver to break 50 USD an ounce. But now, it's surpassed 80 USD in less than 3 months", warned Kathy Kriskey, head of alternative ETF strategy at Invesco.
Ha Thu (according to Reuters)
