Tags: silver | fund | metals | economy

Silver Fund Holdings Surge Most Since 2013 as Price Rally Fades

Image: Silver Fund Holdings Surge Most Since 2013 as Price Rally Fades
(Stock Photo Secrets)

Wednesday, 30 Mar 2016 12:23 PM

Investors are buying silver through funds at the fastest pace in more than two years.

Holdings in silver-backed exchange-traded products jumped 845.6 metric tons in March, heading for the biggest monthly increase since August 2013. Known as the devil’s metal because of its often wild swings, prices are down for a fourth time in five days. Money managers boosted bullish bets to a record in the week ended March 22, the latest U.S. government data show.

“The silver ETF brings in a different type of investors and someone with a smaller appetite for risk because obviously, the low price point,” James Cordier, the founder of Optionsellers.com in Tampa, Florida, said by telephone. “Silver is the much cheaper buy,” compared with gold, he said.

Silver rallied 9.4 percent this year, trailing gold’s 16 percent surge this year. That makes silver attractive to investors betting that the Federal Reserve will be slow in raising interest rates this year, a boon to precious metals because they don’t offer yields or dividends.

Traders are waiting for more clues about the timing of U.S. interest rates increases. While San Francisco Fed President John Williams said on Monday the economy is vulnerable to global developments, other policy makers have recently signaled that borrowing costs may rise as soon as April.

“Flows into ETFs remain strong, which could indicate that longer-term investors are not being put off by the recent retracement,” Ole Hansen, head of commodity strategy at Copenhagen-based Saxo Bank A/S, said by e-mail. Prices are “currently exposed to profit taking after a big build up in speculative longs during the past few weeks.”

Silver for immediate delivery fell 0.6 percent to $15.16 an ounce at 11:59 a.m. in New York, according to Bloomberg generic pricing. Gold for immediate delivery rose 0.5 percent to $1,227.61 an ounce. That takes the gold-silver ratio to 81, compared with a five-year average of 61.6.

ETP Holdings

Holdings in ETPs rose to 19,486 tons as of Monday, the highest since April,  Bloomberg data show. Hedge funds and other speculators boosted their net-long position in U.S. contracts by 6.6 percent in the latest week to the highest since at least 2006, Commodity Futures Trading Commission data show.

Fed Chair Janet Yellen’s speech on Tuesday may give more indications on the outlook for prices, Daniel Hynes, a senior commodity strategist at Australia & New Zealand Banking Group Ltd. in Sydney, said by phone.

© Copyright 2017 Bloomberg News. All rights reserved.

 
1Like our page
2Share
StreetTalk
Investors are buying silver through funds at the fastest pace in more than two years.Holdings in silver-backed exchange-traded products jumped 845.6 metric tons in March, heading for the biggest monthly increase since August 2013.
silver, fund, metals, economy
401
2016-23-30
Wednesday, 30 Mar 2016 12:23 PM
Newsmax Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved