10 December 2010

Sprott says SLV has physical?

I found it interesting in this Sprott piece The Silver Lining that Sprott includes SLV in his table of "real investment demand for silver".

In the context of his point that GFMS and The Silver Institute neglect investment demand, I assume by the use of the word "real" Sprott must mean physical. In which case by including SLV's 305,205,951oz he is therefore saying it does have the physical.

If SLV doesn't, then he shouldn't include it in the table as their holdings would represent fake paper silver. However if he doesn't include SLV then he has no point about GFMS/Silver Institute missing investment demand of 225,783,924oz because without SLV the "aggregate implied investment demand" figure from GFMS/Silver Institute covers the other funds' inflows.


  1. Note that the Sprott chart does not include the holdings of Bullion Management Group Inc., a physical bullion fund company with $460 million in its holdings. Check out http://www.bmgbullion.com/.

  2. Those groups are references, not intended to be totaled. Using SLV as an indicator of investment interest in silver is fairly valid I would have thought.

    And even if SLV is only partially backed, it wouldn't surprise me that the backing ratio remained constant.

  3. Yes, not including BMG is a big miss, but then they are a direct Canadian competitor.

    Interestingly, if the "gap" is 225moz and SLV has 305moz, is the other interpretation that SLV only has 80moz of real silver?