Large Silver ETF Pulls in Record $1.7 Billion on Tuesday
February 03 2021 - 1:10PM
Dow Jones News
By Amrith Ramkumar and Joe Wallace
About $1.7 billion flowed into the largest silver ETF, the
iShares Silver Trust, on Tuesday, shattering the previous all-time
high set last Friday, FactSet data show.
The huge inflow came even though silver prices and the ETF's
shares tumbled, reversing a big Monday rally.
The activity shows how the iShares Silver Trust, which trades
under the ticker SLV, has been at the center of recent
silver-market volatility
(https://www.wsj.com/articles/silver-etf-at-center-of-reddit-fueled-surge-11612281290).
ETFs are one of the easiest ways for day traders and generalist
professional investors to invest in precious metals without taking
hold of any actual material.
When individuals buy shares of the ETF, they are buying a stake
in a trust. The asset held by that trust is silver.
One of the ways traders make a market in the ETF--typically
banks and other traders--is to buy physical metal from traders on
the open market
(https://www.wsj.com/articles/etf-boom-fuels-golds-sharp-rise-11598175001).
Large inflows can signal that the metals are in high demand from
global investors, a trend that then helps dictate sentiment in the
futures market.
The traders selling to the ETF traders might also seek to hedge
against a price increase by purchasing futures contracts, creating
another link between ETFs and metals prices.
The influx into SLV was accompanied by a jump in the amount of
silver changing hands in London, where much of the metal backing
the fund resides.
Just over a billion troy ounces of silver were traded in city's
over-the-counter market on each of Monday and Tuesday, according to
the London Bullion Market Association, both slightly short of an
all-time high in figures dating back to late 2018.
Silver futures were up about 2% at roughly $27 a troy ounce on
Wednesday, stabilizing following yesterday's selloff.
NOTE: In-line links reference additional content of interest
chosen by the WSJ news team.
This item is part of a Wall Street Journal live coverage event.
The full stream can be found by searching P/WSJL (WSJ Live
Coverage).
(END) Dow Jones Newswires
February 03, 2021 12:55 ET (17:55 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
Nokia (NYSE:NOK)
Historical Stock Chart
From Aug 2024 to Sep 2024
Nokia (NYSE:NOK)
Historical Stock Chart
From Sep 2023 to Sep 2024