The Top Silver ETFs in Canada for December 2024

ByDan Kent Published On:

Commodity-based exchange-traded funds, like silver ETFs, are quickly winning folks over.

Why? Many investors new to buying stocks have heard that commodities perform exceptionally well in inflationary environments.

In terms of gold and silver, this myth has generally been debunked. Gold and silver haven’t been a haven in inflationary environments over the long term.

However, when we look at rapid inflation, an environment that we are indeed in today, silver and gold have been known to perform quite well.

Contrary to this, companies in the technology sector (or even technology ETFs) struggle due to excessive cash burn.

So, in this situation, many Canadian ETF investors have been searching for the best silver ETFs in Canada to gain exposure to the precious metal in their portfolio. In this article, we’re going to give them to you.

The best silver ETFs in Canada to buy now

  • Sprott Physical Silver Trust ETF (TSE:PSLV)
  • Global X Silver Miners ETF (ARCA:SIL)
  • ETFMG Prime Junior Silver Miners ETF (ARCA:SILJ)

Sprott Physical Silver Trust ETF (TSE:PSLV)

The Sprott Physical Silver Trust (TSE:PSLV) is a physical silver bullion ETF that provides Canadians with exposure to the actual metal. In our opinion, it is one of the best ways to hold silver in Canada today.

The ETF is liquid, with over 3M shares traded daily, with just over $3.5 billion in assets.

One interesting concept with the Sprott silver ETF is that investors can redeem their units for actual physical silver. This redemption option means shares are likely to always trade near their net asset value (NAV).

Now, some conditions have to be met, like having enough units to equate to 10 1000oz silver bars, but it is a unique feature nonetheless.

Another critical factor with Sprott is that there is no “middle man” regarding their silver bullion. In some situations, physical silver ETFs will store their silver at a financial institution. The silver might be at risk if that institution were to go bankrupt.

Sprott’s physical silver is held in storage with the Royal Canadian Mint, a Federal Crown Corporation of the Government of Canada.

Total management fees on this close-ended trust are around 0.59%, meaning you’re paying $5.90 for every $1000 invested.

In terms of overall investment results, the fund lacks. This was primarily because it was launched in 2010 when silver prices were extremely high due to the fallout of the financial crisis.

But with a silver ETF, you’re buying because of future expected performance. I wouldn’t put much emphasis on past results.

Overall, if you’re looking to hold on to physical silver, this is the best silver ETF in Canada to do so.

Global X Silver Miners ETF (ARCA:SIL)

Unfortunately, there aren’t many silver ETFs trading on the TSX in Canada that focus on miners. So, as a result, you’ll have to head south of the border to gain any meaningful exposure.

However, the Global X Silver Miners ETF (ARCA:SIL) is still very much a play on Canadian silver mining, as 3 of the top 9 holdings are all Canadian miners:

  • Wheaton Precious Metals (TSE:WPM)
  • Pan American Silver Corp (TSE:PAAS)
  • SSR Mining (TSE:SSRM)

The silver ETF has over $925M in net assets at the time of writing, and you’ll have no difficulty in liquidity, as more than 420,000 shares exchange hands daily. Its inception date was April 19th, 2010. 

However, the one thing you should brace yourself for with this top Canadian silver ETF is volatility.

This ETF is prone to significant swings in price. Case in point, let’s have a look at the last nine years in terms of overall performance:

  • 2022: -22%
  • 2021: -19%
  • 2020: +41%
  • 2019: +34%
  • 2018: -22.6%
  • 2017: +1.04%
  • 2016: +80.34%
  • 2015: -33%
  • 2014: -16.9%
  • 2013: -50.31%

These wild price fluctuations have left the silver miner ETF with an average annual loss in the high single digits over the last decade.

However, its poor performance has been based on the underlying commodity’s poor performance, as most miner-based ETFs will succumb to.

Miners tend to outperform the underlying commodity in a bull market and underperform the commodity in a bear market.

If you believe that silver will be on the rise moving forward, then this silver ETF should be able to outperform.

In terms of expenses, fund fees for this ETF come in at a total of 0.65%, which means you’ll pay $6.50 per $1000 to own the ETF.

SIL has tracked silver prices quite closely over the last few years. This is primarily because it exposes you to some of the world’s largest and most reliable silver miners.

ETFMG Prime Junior Silver Miners ETF (ARCA:SILJ)

If you want the biggest risk/reward exposure to silver via a silver ETF, then the ETFMG Prime Junior Silver Miners ETF (ARCA:SILJ) will be where you want to look.

Why? Well, this is a junior silver mining ETF, meaning it is made up of smaller companies focused on mining silver. It offers diversification, but only among one asset class. 

And if you’re new to junior miners with silver and any commodity, they are prone to significant swings in price.

Again, this is a US-listed ETF. However, the top 10 holdings, which account for over 63% of assets at the time of writing, are essentially all Canadian. In fact, 8 of the 10 top holdings in this ETF are Canadian-listed stocks, containing the likes of:

  • First Majestic Silver (TSE:FR)
  • Pan American Silver Corp (TSE:PAAS)
  • MAG Silver Corp (TSE:MAG)
  • Eldorado Gold (TSE:ELD)
  • SilverCrest Metals (TSE:SIL)
  • SSR Mining (TSE:SSRM)
  • Capstone Copper (TSE:CS)

With $660 million in net assets and over 1.4 million shares in total daily volume, this is the most active silver ETF on this list, and you’ll have no problems buying and selling shares when you want to.

And in terms of performance, it’s been the best-performing silver ETF on this list over the last 1, 3 and 5-year timelines. Its five-year average gains are in the barely positive, coming in at 0.46% per year at the time of writing.

Please make no mistake, though, this ETF is highly volatile. A prime example? Before posting a massive 139% gain in 2016, the ETF lost 53%, 11% and 37% in the previous three years.

The ETF has a beta of 1.26, suggesting that when the market moves 1%, this ETF will move 1.26%, highlighting its volatility.

The management expense ratio for this ETF comes in at 0.69% or $6.90 per $1000 invested. So, it’s the most expensive of the bunch, and this is a high fee for an ETF. However, as we move into more “niche” ETFs like this, we can expect to pay more.

This is by far the riskiest silver ETF on this list and should be reserved for those with a high tolerance for risk.

Interestingly enough, the ETF has underperformed in the price of silver itself, primarily because of the COVID-19 market crash and its effect on junior miners.

What types of silver ETFs are available in Canada?

Generally, when you’re looking at silver ETFs or any commodity ETF for that matter, there are three particular types:

  • Physical ETFs
  • Equity ETFs
  • Futures based ETFs

You want to purchase an ETF with physical silver ETFs that hold the underlying commodity.

With equity silver ETFs, you want to gain exposure to silver miners by buying an ETF that holds their stocks.

And finally, futures-based silver ETFs will use futures contracts to bet on pricing movements in the metal.

We don’t speak much about futures ETFs in this article, as they are advanced investment products. However, we provide a nice mix of physical and equity-based silver ETFs that should help you decide which one you want to buy today.

Overall, these top Canadian silver ETFs are perfect for exposure to the metal

If you’re bullish on silver, these will be the silver ETFs you want to look at. Because of the security and the way physical silver is held, Sprott’s PSLV is the best way to hold actual silver through an ETF.

An alternate is the iShares Silver Trust (ARCA:SLV). However, regulatory situations with this one, like it not being registered as a commodity pool, tend to have me leaning toward Sprott’s version. However, the iShares Silver Trust is the most liquid physical silver ETF on the market. So, it is an option.

Just understand what you’re buying before you buy it. Make sure you read the prospectus of any ETF before you buy. Also, be aware of brokerage commissions and transaction costs, especially if you’re an active trader.

We’re limited here regarding silver ETFs regarding producers, so the two US-listed ETFs I showed you here are arguably your best exposure to miners, whether major producers in SIL or juniors in SILJ.

Overall, I hope you enjoyed this list of the top silver ETFs, and if you find any more that are of use, feel free to contact us, and we’ll add them to the list.