As silver prices reach levels not seen in almost 14 years, investors are not only stocking up on bars, but they’re also loading up on silver ETFs at a record pace. And the game is no longer about price momentum. Structural changes in demand, constricting physical supply, and gold’s rapidly unaffordable glamour are pointing capital toward ETFs linked to silver, the “poor man’s gold” that’s now enjoying a rich run.
Silver ETFs added more than 2,570 tons of the metal since February, Bloomberg data shows, and they are playing a central role in the most recent supply squeeze. The effect has been so sharp that it’s now tightening the physical silver market in London, the main vaulting center for ETF holdings, and driving borrowing rates for the metal to more than 6%, an astonishing spike from their typical near-zero level.
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ETF Buyers At The Forefront
While physical silver markets are constrained, silver ETFs are the investment of choice for both retail and institutional investors seeking to enjoy the rally. Let’s see how the top players compare:
iShares Silver Trust (NYSE:SLV)
The heavy hitter in the silver ETF space, SLV, holds over 474 million ounces of silver and manages nearly $18 billion in assets under management (AUM). It follows the price of silver by maintaining physical bullion in vaults, providing a low-friction means to get exposure without the hassles of storage.
Why it matters: The largest and most liquid silver ETF, SLV, frequently serves as a barometer of investor sentiment towards the metal. The fund is up almost 30% this year so far.
Aberdeen Standard Physical Silver Shares ETF (NYSE:SIVR)
SIVR follows essentially the same approach as SLV, owning fully allocated physical silver, but draws more budget-price-conscious investors. At an expense ratio of 0.30%, versus SLV’s 0.50%, it has slowly gained a niche.
Why it’s important: Lower costs become more appealing in a high-inflation world where even slight differences in interest rates matter. Like SLV, the fund is up 30% so far this year.
Global X Silver Miners ETF (NYSE:SIL)
Those who want silver exposure but prefer the equity approach can achieve it via SIL, which offers access to a portfolio of international silver mining firms, including Fresnillo (OTCPK: FNLPF), Pan American Silver (NYSE:PAAS), and Hecla Mining (NYSE:HL).
Why it matters: Although mining stocks provide leverage to silver prices, they also carry company-specific and geopolitical risks. SIL is rising sharply this year as silver miners benefit from the bull run. The fund is up a good 53.5% this year.
What’s Driving The Demand?
A variety of forces are driving investor demand:
Relative value: Silver remains trading below its historic ratio to gold. At an 86 gold-to-silver ratio, silver could be undervalued, given that the number averages nearer to 80 over the past decade.
Trade tensions: The most recent round of threats of tariffs between the U.S. and Mexico, the globe’s leading silver producer, raised concerns about potential supply interruptions.
Industrial demand: Silver is an essential input for solar panels and electronics, making it have a special dual identity, both a precious metal and an industrial commodity.
Supply deficit: The Silver Institute estimates a fifth straight year of market deficit in 2025, as cited by Bloomberg, further solidifying the long-term investment thesis.
The Bigger Picture For ETF Flows
This year’s rally has transformed silver ETFs from quiet portfolio diversifiers into high-conviction trades. While gold ETFs have mostly recorded flat to negative inflows due to high prices and risk-off central bank sentiment, silver ETFs are attracting new money, courtesy of their lower entry price and more compelling upside story.
If silver continues to outpace gold, as it has to date in 2025, the pace of ETF flows will gain even more momentum, particularly for retail investors seeking exposure without exceeding their budgets.
Silver does not have the bling of gold, perhaps, but in the world of ETFs, it’s stealing the spotlight right now. Tightening physical supply and increasing investor appetite have turned silver ETFs from supporting actors to protagonists in the commodity resurrection.
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