Versus other assets, gold and silver have been dominating year-to-date returns with the first half of 2025 in the books. With more market uncertainty ahead and as growth factors abound for alternative energy, the duo looks set for continued upside.
Amid the cacophony of tariffs, interest rates, geopolitical tensions, and eroding trust in the dollar, gold has been a sweet symphony. The precious metal is up over 20% for the year, giving investors stability after heightened volatility the first six months.
Opportune Asset for Backdoor Play
“Taken in its entirety, we believe gold is being bought as a safe haven asset due to the U.S. dollar’s eroding store of value role and the fracturing of trust across nearly all global monetary and political orders and systems,” noted Sprott market strategist Paul Wong in the Precious Metals Report.
Silver’s electrical conductivity properties make it an opportune asset for a backdoor play on global electrification. Whether it’s data centers powering artificial intelligence (AI) applications to electric vehicles (EV), the world will demand electricity. Prospective silver investors shouldn’t ignore that growth opportunity.
Included in the Precious Metals Report is a chart that highlights the performances of gold miners via the NYSE Arca Gold Miners Index, gold bullion, and silver bullion. The trio managed to outperform major indexes in other asset classes, including equities, Treasuries, and broad commodities.
Given this outperformance, it calls to mind a pair of funds that meld gold and silver in the convenience of one fund.
Source: Bloomberg, as of June 30, 2025. The EURO STOXX 50 Index tracks 50 large, blue-chip European companies operating within eurozone nations. The MSCI World Index tracks large and mid-cap representation across Developed Markets countries, while the MSCI World ex USA excludes the United States. Bitcoin is measured by the S&P Bitcoin Index, designed to track the performance of the digital asset. The Nasdaq-100 Index tracks the 100 largest, most actively traded companies listed on the Nasdaq stock exchange. The U.S. Treasury Index, based on recent auctions of U.S. Treasury bills, is commonly used as a benchmark when determining interest rates. Please see the footnotes and the Sprott Report for additional information.
Combining Exposure in 1 Fund
The safe haven of gold and the industrial exposure of silver may lead to diverging paths when an investor is trying to decide where to allocate their capital. They can easily opt for both with the Sprott Physical Gold and Silver Trust (CEF).
With the dual exposure to both gold and silver, CEF offers a diversified option. Investors may attain the upside of gold when the dollar falters, interest rates fall, equities or bonds falter, and other market forces. Because silver’s strength also ties to the broad economy due to its industrial component, investors could attain that potential upside as well.
A potential benefit is exposure to gold and silver bullion without the logistical challenges of storage. However, investors can redeem their shares for physical metal if they so wish. As of June 30, the market value of gold held is just over $4 billion, and just under $2 billion for silver.
An Active Pairing
Miners can offer investors an alternate play on gold and silver prices. When demand for both metals rise, miners can also exhibit strength. Investors can combine both gold and silver mining exposure in one actively managed fund: the Sprott Active Gold & Silver Miners ETF (GBUG).
When gold exhibits strength and silver falters, or vice versa, GBUG’s combination of both can act as a hedging component. Of course, the prime feature of GBUG is its active management.
Sprott’s portfolio managers can adjust the holdings of the fund based on the current market conditions. This gives GBUG the flexibility when market forces warrant changes in the holdings of both gold and silver miners.
GBUG holds companies engaged in mining, developing, exploring, and financing operations in relation to gold and silver.
Further Diversification
Additionally, the fund is further diversified with exposure to other countries. While 70% of the fund’s holdings are domiciled in Canada, the rest is spread over the U.S., Australia, and Great Britain.
For more news, information, and analysis, visit the Gold/Silver/Critical Minerals Channel.
An invesor should consider the investment objectives, risks, charges, and expenses carefully before investing. To obtain a Prospectus, which contains this and other information, contact your financial professional or call 888.622.1813. Read the Prospectus carefully before investing, which can also be found by clicking one of the links below.
Past performance is no guarantee of future results. One cannot invest directly in an index.
Funds that emphasize investments in small/mid-cap companies will generally experience greater price volatility. Diversification does not eliminate the risk of investment losses. ETFs are considered to have continuous liquidity because they allow an individual to trade throughout the day. A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses, affect the Fund’s performance.
GBUG adviser’s judgments about the growth, value, or potential appreciation of an investment may prove to be incorrect or fail to have the intended results, which could adversely impact the GBUG’s performance relative to its benchmark.
Sprott Asset Management USA, Inc. is the Investment Adviser to the ETFs. ALPS Distributors, Inc. is the Distributor for the ETFs and is a registered broker-dealer and FINRA Member. ALPS Distributors, Inc. is not affiliated with Sprott Asset Management USA, Inc. or VettaFi.
Exchange Traded Funds (ETFs): SETM, LITP, URNM, URN, COPP, COPJ, NIKL, SGDM and SGDJ
Physical Bullion Funds: PHYS, PSLV, CEF, and SPPP.
Gold and precious metals are referred to with terms of art like store of value, safe haven and safe asset. These terms should not be construed to guarantee any form of investment safety. While “safe” assets like gold, Treasuries, money market funds and cash generally do not carry a high risk of loss relative to other asset classes, any asset may lose value, which may involve the complete loss of invested principal.
A message from Advisor Perspectives and VettaFi: To learn more about this and other topics, check out some of our webcasts.
Read more commentaries by VettaFi
