Explore Driver’s Behind Silver’s Growing Demand
As volatility continues to jolt markets, silver stands out as a powerful way to diversify, offering the potential to benefit from booming industrial demand and supply constraints at an affordable entry point.
Equities continue to experience volatility amid geopolitical uncertainty, shifting government policies, concerns over valuations, and a weakening U.S. dollar. Against this backdrop, more investors are seeking a way to anchor their portfolio with assets that will have durable value.
For many, silver is the answer.
Safe Haven Status and Resilient, High Demand
With so many practical applications, silver is often considered a safe haven asset that retains its intrinsic value. As the world's best electrical conductor, silver has utility across use cases like solar panels, EVs, cell phones, medical devices, and computing/processing power for cloud computing and AI. As a result, demand is likely to continue. Estimates suggest that demand for silver will outpace supply by 149 million ounces in 2025.1 This constrained supply and ongoing demand have created an imbalance and set the stage for significant price growth potential.
Seeking Stability and Growth Potential with the Amplify Junior Silver Miners ETF (SILJ)
Silver's growth potential is important because it may help stabilize a portfolio's value as inflationary pressures increase. The threat of rising prices remains a concern for investors, as sweeping tariff policies pass higher costs onto consumers. These price concerns have translated into some of the most volatile equity markets of the last several decades.
Simultaneously, some investors are rethinking their bond allocations amid expectations that inflation could exceed interest rates over the long term. Therefore, many are renewing their focus on asset classes uncorrelated to stocks.
Silver's typically low correlation with stocks and bonds makes it an excellent portfolio diversification tool. Silver's safe-haven role may also help stabilize portfolios during market volatility, supporting balanced growth.
Strategic Exposure to Small-Caps
Small-cap silver mining companies have historically benefited from the tailwinds behind the price of silver and offer a unique way to add portfolio diversification. Because silver miners often exhibit higher beta2 relative to the metal itself, they tend to amplify silver’s price movements—potentially delivering greater returns during rallies, but can also experience deeper declines in a downturn. SILJ is the first and only ETF to target small-cap silver miners. The ETF tracks the performance of companies engaged in the silver mining industry that derive most of their revenues from silver mining, global silver production, or exploration and development activities related to new silver production. SILJ seeks investment results that generally correlate (before fees and expenses) to the total return performance of the Nasdaq Junior Silver Miners Index.
Advantageous Gold/Silver Ratio:
Today, the gold/silver ratio, which measures the number of ounces of silver needed to buy one ounce of gold, is hovering close to 91. This figure is well above the long-term historical average of 50-60, signaling that silver may be undervalued and positioned for a rise in price. SILJ is well positioned to benefit from such an increase given that a higher price-per-ounce of silver often makes silver mining more profitable.
Additionally, SILJ's strategy may offer potential upside from the continued demand for core inputs needed across industries. This demand is unlikely to suffer from tariff pressures as the U.S. exempted precious metals from the recent reciprocal tariffs. Imports of precious metals from Canada and Mexico will also remain tariff-free for the time being, as they comply with the U.S.-Mexico-Canada agreement on free trade.
The combination of increasing industrial demand for silver, freedom from tariffs, and an attractive gold/silver ratio present a strong set of catalysts that may help drive the value of SILJ higher over the long-term.
1Global Silver Market Forecast to Remain in a Sizeable Deficit in 2025 | The Silver Institute 2 Beta: (β) is a measure of a stock's volatility in relation to the overall market. It is used in the Capital Asset Pricing Model (CAPM) to estimate the expected return of an asset based on its risk relative to the market.
Carefully consider the Fund’s investment objectives, risks, charges, and expenses before investing. This and other information can be found in the Fund’s statutory and summary prospectuses, which may be obtained at AmplifyETFs.com. Read the prospectus carefully before investing.
Investing involves risk, including the possible loss of principal. Shares of any ETF are bought and sold at market price (not NAV), may trade at a discount or premium to NAV and are not individually redeemed from the Fund. Brokerage commissions will reduce returns. Narrowly focused investments typically exhibit higher volatility. Investments in foreign securities involve political, economic and currency risks, greater volatility and differences in accounting methods. These risks are greater for investments in emerging markets. The Fund is non-diversified, meaning it may concentrate its assets in fewer individual holdings than a diversified fund. Therefore, the Fund is more exposed to individual issuer volatility than a diversified fund. Funds that are less diversified across countries or geographic regions are generally riskier than more geographically diversified funds and risks associated with such countries or geographic regions may negatively affect a Fund.
Investments in small-capitalization companies tend to have limited liquidity and greater price volatility than large-capitalization companies. There are risks associated with the worldwide price of silver and the costs of extraction and production. Worldwide silver prices may fluctuate substantially over short periods of time, so the Fund’s share price may be more volatile. Several foreign countries have begun a process of privatizing certain entities and industries. Privatized entities may lose money or be renationalized. The Fund invests in some economies that are heavily dependent upon trading with key partners. Any reduction in this trading may cause an adverse impact on the economy in which the Fund invests.
The Fund’s return may not match or achieve a high degree of correlation with the return of the Index. To the extent the Fund utilizes a sampling approach, it may experience tracking error to a greater extent than if the Fund had sought to replicate the Index.
Investing involves risk, including the possible loss of principal. Shares of any ETF are bought and sold at market price (not NAV), may trade at a discount or premium to NAV and are not individually redeemed from the Fund. Brokerage commissions will reduce returns.
Amplify Investments LLC is the Investment Adviser to the Fund, and Tidal Investments, LLC serves as the Investment Sub-Adviser.
Amplify ETFs are distributed by Foreside Fund Services, LLC.
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