Silver prices hit a record high! How to choose among seven silver ETFs? A guide for Taiwanese investors to get started

Silver Market Sparks: The Biggest Black Horse Asset of 2025

Expectations of Federal Reserve rate cuts, global supply chain tensions, and multiple positive factors such as silver inclusion in the US critical mineral list have fueled the silver market. London spot silver surged in mid-December 2025, breaking the psychological $70/oz level, reaching a high of $83.645/oz, rewriting historical records.

In terms of annual performance, silver has already gained over 140% this year, becoming the brightest performing asset globally, outpacing gold by 80% and far surpassing the Nasdaq Composite Index by about 120%. Market speculation is intense, with CME raising margin requirements twice in December to cool the rally. The latest adjustment increased the initial margin for March 2026 contracts from $22,000 to $25,000, a 25% monthly increase.

This policy intervention temporarily cooled silver prices, pushing them into the $70–75 range, but market expectations for the 2026 silver outlook remain optimistic.

Silver ETFs: Participate Without Buying Physical Silver

What is a silver ETF? Why are investors eager to buy?

Silver ETFs are investment funds tracking silver price fluctuations, allowing investors to avoid the hassle of storing physical silver—buying and selling through securities accounts. The operation is straightforward: the fund directly holds physical silver or uses futures and derivatives to replicate silver price performance, with returns directly linked to market prices.

For example, if silver prices rise by 5%, the net asset value (NAV) of the silver ETF also increases by about 5%; if silver prices fall, the fund’s value declines proportionally. Like stock trading, investors can enter or exit at any time during trading hours, with liquidity far superior to physical silver.

Why not buy physical silver directly?

Physical silver offers a tangible, “see and touch” psychological comfort, but practical issues abound. Storage costs are a primary concern: renting safes or entrusted warehouses incurs extra fees, and keeping silver at home requires protection against oxidation, theft, or damage.

The trading process is also cumbersome—buyers must find jewelry stores or precious metals dealers, paying 5–6% spreads, and verifying purity costs extra. The biggest challenge is low liquidity; when in urgent need of cash, immediate sale is difficult, and purchase prices vary across regions with little transparency.

In contrast, silver ETFs can be bought and sold flexibly through securities accounts, eliminating storage and verification worries, closely tracking silver prices, and serving as the best entry point for retail investors in Taiwan.

How Can Taiwanese Investors Buy Silver ETFs?

Option 1: Discretionary Trust (Most Popular)

Using domestic brokerages (Fubon, Cathay, Yuanta, Fubon, etc.) to entrust overseas brokers is the preferred method for most Taiwanese investors.

Process:

• Open a discretionary trust account (online or in person)
• Choose TWD or USD settlement
• Search for the ETF code (e.g., SLV) via app and place orders; most brokers support regular fixed investments

Advantages: Protected by the Financial Supervisory Commission, tax assistance from brokers, funds do not need to be remitted abroad

Disadvantages: Higher fees, limited tradable products

Option 2: Direct Account Opening with Overseas Brokers

Open an account directly on an overseas broker platform, with lower costs but requiring self-management of taxes and remittances.

Process:

• Complete online account registration (prepare passport, ID, proof of address)
• Deposit via wire transfer (set up designated accounts for TWD to USD)
• Search for the ETF code and place orders

Advantages: Very low or zero commissions, extensive product selection, support for advanced tools

Disadvantages: English interface, self-handling of taxes, lack of legal protections in Taiwan for remittance and inheritance

Top 7 Popular Silver ETFs Compared

Detailed Descriptions of Each ETF

SLV – The World’s Largest Silver Holdings

Launched in 2006, managed by BlackRock, this flagship product has over $30 billion in net assets. Since 2014, it tracks the LBMA silver benchmark price, primarily holding physical silver, with JPMorgan as custodian. It adopts a passive management strategy, rarely buying or selling silver, only selling small amounts to cover operational costs. Suitable for long-term holders.

AGQ – Leveraged Double Risk Tool

Introduced in 2008, it provides 2x leverage through futures, swaps, and derivatives. Designed for short-term arbitrage traders. Beware of compounding erosion and long-term losses; it’s only suitable for trading within days or weeks, not long-term holding.

ZSL – The Inverse Choice

Provides daily -2x performance of silver prices, designed for hedging declines or bearish bets. Its leverage and inverse nature mean it’s only for short-term use; holding over a week causes compounding losses that eat into gains.

PSLV – Unique Physical Silver Redemption Rights

Launched in 2010, a closed-end fund with a fixed number of units, traded at market prices often at premiums or discounts (unlike traditional ETFs close to NAV). Its key feature is allowing investors to redeem physical silver, with assets of $12 billion, favored by long-term investors.

SLVP – Mining Stocks Portfolio

Launched by BlackRock in 2012, managing $600 million, with a low expense ratio of 0.39%. Invests in global silver mining companies with weight limits (no single stock over 25%, combined >5% holdings ≤50%). Historically volatile, with noticeable tracking errors and large bid-ask spreads, making it less attractive.

Taiwan’s Dow Jones Silver Excess Return Index ETF

Established in 2018, tracking the Dow Jones Silver Excess Return Index via COMEX futures. IPO price at NT$20, first-day opening NT$19.86, high volatility, no dividends. The most convenient choice for Taiwanese investors, but with less liquidity and fewer underlying assets than US ETFs.

Complete Tax Guide for Silver ETFs

( Taiwan-listed Silver ETFs

Purchasing Taiwan-listed silver ETFs (like Taiwan’s Dow Jones Silver ETF) is treated like stocks: tax-free on purchase, 0.1% transaction tax on sale.

) Overseas-listed Silver ETFs

Profits from buying US or other foreign silver ETFs are considered overseas property transaction income, included in foreign income.

Tax Thresholds and Calculation:

If total overseas income ≤ NT$1 million annually, fully exempt from minimum tax; exceeding NT$1 million, the entire amount (including dividends, interest, etc.) is included in taxable income. Tax is calculated as: (Basic income after deducting NT$7.5 million exemption) multiplied by 20%.

If investors incur property transaction losses (e.g., silver ETF losses), they can offset other income within the same year, reducing taxable base. This regulation helps long-term investors balance tax burdens across profitable and loss years.

Silver Investment Methods Comparison: ETF vs. Physical Silver vs. Futures vs. Mining Stocks

The table shows futures offer the highest potential return but with the greatest risk; mining stocks are high but with company-specific risks; ETFs offer moderate returns with minimal risk, ideal for beginners; physical silver offers the lowest return but tangible security.

Five Major Risks in Silver ETF Investment

1. Price Volatility Far Exceeds Gold and Stocks

Despite a 140% rise in silver in 2025, historical sharp corrections of 20–30% are common. After margin increases on December 29, silver prices plunged over 11% intraday, causing heavy losses for many investors. Such extreme volatility is hard to bear for risk-averse investors.

2. Tracking Errors and Fee Erosion

Futures-based ETFs suffer from roll costs, often underperforming spot silver over time; physical ETFs have high accuracy but annual fees of 0.4–0.5% gradually eat into returns. Over ten years, fees can erode over 5% of gains.

3. Currency and Tax Risks for Overseas ETFs

USD fluctuations, overseas income tax reporting, withholding taxes (e.g., 30% US withholding) can reduce actual returns. Cross-border investing appears simple but involves complex tax considerations.

4. Geopolitical and Industrial Demand Impacts

Silver prices are driven not only by USD and interest rates but also by geopolitical tensions, solar and electronics industry demand, semiconductor supply chains, etc. Single events can trigger large swings.

5. Hidden Risks of Poor Product Choices

Leveraged ETFs (AGQ, ZSL) are unsuitable for long-term holding; mining stocks have large tracking errors, wide bid-ask spreads, and information asymmetry, increasing the risk of pitfalls.

Conclusion

Silver ETFs, as modern precious metal assets, offer a securitized alternative to physical storage, with excellent liquidity and trading convenience—ideal for investors wanting to follow silver market trends without the burden of physical storage costs.

However, silver prices are highly volatile, influenced by industrial supply/demand and market sentiment. Different ETFs vary significantly in fees, holdings, and leverage. Diversification and regular review of market conditions and positions are recommended to manage risks and navigate cycles rationally.