Though the Fed’s various monetary stimuli haven’t triggered significant inflation thus far, the possibility still concerns many investors. So it was no surprise that the confirmation of QE3 had many advisors shoring up their gold and silver positions. Today’s recommendation is one of those, a silver fund from Canadian Wealth Advisor.
“In September 2011, gold hit an all-time high of $1,900.30 U.S. an ounce. It now trades at around $1,700.80. Silver rose to an all-time high in April 2011, when it reached $49.76 U.S. an ounce. It has since pulled back to today’s price of $32.63. Gold and silver could well regain their highs and move up even further over the longer term, although they will likely remain volatile. Higher prices would arise from investor fears that inflation or global political and economic instability will hurt key currencies, such as the euro or the U.S. dollar.
“If you want to hold a number of gold or silver stocks, [this] exchange traded fund [offers exposure to] top-quality global miners and low fees. Global X Silver Miners ETF (SIL, $25) tracks the Solactive Global Silver Miners Index. This index includes between 20 and 40 international companies that mine, refine or explore for silver. Germany-based Structured Solutions AG developed this index. Canadian companies make up 42.9% of the fund’s holdings, but it also includes companies based in Mexico (13.0%) and the U.S. (12.3%). The ETF’s MER is 0.65%. The fund’s top holdings are Silver Wheaton at 13.7%; Fresnillo plc, 11.7%; Industrias Penoles, 10.8%; Pan American Silver, 8.5%; First Majestic Silver, 5.9%; Hecla Mining, 5.8%; Coeur d’Alene Mines, 4.9%; Polymetal, 4.6%; Silver Standard Resources, 4.5%; Tahoe Resources, 4.3%; Hochschild Mining, 4.0%; and Silvercorp Minerals, 3.7%. Global X Silver Miners ETF is a buy for aggressive investors who want to hold a silver fund.”
- Patrick McKeough, Canadian Wealth Advisor, September 2012