Silver Mining ETF Tops in May: 5 Stock Winners

iShares MSCI Global Silver Miners ETF SLVP topped the list of best-performing ETFs in May, gaining 18.4%. Being a leveraged play, metal miners tend to experience more gains than their bullion cousins in a rising metal market.

As the global economy is recovering from the pandemic buoyed by rapid vaccinations and reopening of the economies, industrial and manufacturing demand is picking up providing a boost to silver prices. The white metal is used in a wide range of industrial applications. About half of the metal’s total demand comes from industrial applications, while 30% comes from jewelry/silverware/coins and medal manufacturers (read: 5 Great Value ETFs to Buy as Inflation Fears Grip Markets).

Additionally, rising inflationary pressures have driven up demand for silver as an inflation hedge. A weaker greenback also added to the strength as it makes dollar-denominated assets attractive for foreign investors, raising the appeal for precious metal.

Further, the global push for green energy, increasing demand in areas like 5G, a rebound in global computer shipments, and new sources of demand for sensors used in IoT and OLED lighting will continue to boost silver demand. Silver is largely used for manufacturing of solar panels and electric vehicles, and will play a key role in the shift to 5G wireless network technology.

Let’s take a closer look at the fundamentals of SLVP.

SLVP in Focus

This fund follows the MSCI ACWI Select Silver Miners Investable Market Index, providing investors exposure to companies that derive the majority of revenues from silver exploration or metals mining. It holds 29 stocks in its basket with Canadian firms making up the lion’s share at 67.3% while the United States round off the next spot with double-digit exposure. SLVP has AUM of $354 million and an average daily volume of about 208,000 shares. It charges 39 bps in annual fees (see: all the Materials ETFs here).

Though most of the stocks in the fund’s portfolio delivered strong returns, a few were up more than 20% in May. Below we have highlighted the five best-performing stocks in the ETF with their respective positions in the fund’s basket:

Best Performing Stocks of SLVP

Hecla Mining Company HL: This company is a leading low-cost U.S. silver producer with operating mines in Alaska and Idaho, and is a growing gold producer with an operating mine in Quebec, Canada. The stock occupies the second position in the basket with 9.8% share and soared 40% last month. It carries a Zacks Rank #3 (Hold) and a Growth Score of A.

Endeavour Silver Corporation EXK: This small-cap silver mining company is focused on the growth of its silver production, reserves and resources in Mexico. It jumped about 27.6% in May. Endeavour Silver currently has a Zacks Rank #4 (Sell) and Growth Score of A. The stock makes up for 2.8% share.

New Gold Inc. NGD: This company is focused on the exploration and development of the Afton Copper-Gold Project, located 6 miles (10 km) west of Kamloops, British Columbia. The stock rallied 23.2% in May and makes up for 3.1% in SIL portfolio. It has a Zacks Rank #3 and Growth Score of A (read: Commodity Prices on an Unstoppable Rally: ETFs to Benefit).

Coeur Mining Inc. CDE: This company operates as a primary silver and gold producer with precious metals mines in the Americas. The stock gained 19.2% in May. It currently carries a Zacks Rank #4 and has a Growth Score of B. Coeur Mining accounts for 19.2% allocation.

Newmont Corporation NEM: It is one of the world's largest producers of gold with several active mines in Nevada, Peru, Australia and Ghana. The stock delivered returns of 14% last month. The stock has a Zacks Rank #3 and Growth Score of A. Newmont occupies the fifth position and makes up 5.3% of SIL.

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Newmont Corporation (NEM) : Free Stock Analysis Report
New Gold Inc. (NGD) : Free Stock Analysis Report
Hecla Mining Company (HL) : Free Stock Analysis Report
Coeur Mining, Inc. (CDE) : Free Stock Analysis Report
Endeavour Silver Corporation (EXK) : Free Stock Analysis Report
ISHARS-M GL SLV (SLVP): ETF Research Reports
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By Matt Earle

Matthew Earle is the Founder of MiningFeeds. In 2005, Matt founded to provide data and information to the mining investment community. This site was merged with Highgrade Review to form MiningFeeds. Matt has a B.Sc. degree with a minor in geology from the University of Toronto.

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