Expected advantages of investing in the units include:
• Investment in Physical Silver Bullion Only. Except with respect to cash held by the Trust to pay expenses and anticipated redemptions, the Trust expects to own only London Good Delivery physical silver bullion. The Manager intends to invest and hold approximately 97% of the total net assets of the Trust in physical silver bullion in London Good Delivery bar form.
The Trust will not invest in silver certificates or other financial instruments that represent silver or that may be exchanged for silver.
• Ability to Redeem Units for Physical Silver Bullion.
• Storage at the Royal Canadian Mint.
The Mint is a Canadian Crown corporation, which acts as an agent of the Canadian Government, and its obligations generally constitute unconditional obligations of the Canadian Government. The Mint will be responsible for and bear the risk of loss of, and damage to, the Trust's physical silver bullion that is in the custody of the Mint (regardless of the location at which the Mint decides to store the physical silver bullion).
The physical silver bullion will be inspected by a representative of the Manager with a representative of the Trust's external auditor on an annual basis and periodically on a spot-inspection basis.
The big news on the day with respect to silver came from Eric Sprott who has now been given permission to form a silver ETF whereby once a month the holder of the contract can purchase 1000 oz silver bars redeeming the necessary number of shares.
This is the kiss of death for the banking cartel as all holders of SLV will jump to this new silver ETF format as it guarantees physical. The SLV does not.
Many players have bolted from the GLD into Sprotts PHYS which is strictly a physical gold fund and the new silver ETF is patterned after the GLD model.
The Hinde Capital report, "Precious Metal ETFs Alchemy: GLD -- the New CDO [Collateralized Debt Obligation] in Disguise?," asserts of the gold and silver ETFs:
"-- ETFs should not be owned by serious professional investors.
"-- ETFs offer none of the benefits of physical bullion ownership.
"-- ETFs are no cheaper than owning physical allocated bullion stored and insured in secure vaults.
"-- ETFs are not as secure as owning physical allocated bullion either via a bullion fund or an allocated bullion account.
"-- ETFs provide no returns above the bullion price, only the likelihood of tracking at a discount or potentially failing to track the bullion price at all.
"-- ETFs do not provide 24-hour liquidity, unlike the bullion market itself.
"-- It is evident that gold with multiple owners has entered into unallocated and more importantly allocated accounts. We see it as highly likely that encumbered or leased gold could thus be in ETF products."
The Hinde Capital report also notes the likely conflict of interest of the precious metal ETF custodians, HSBC and JPMorganChase, which are also the big shorts in the gold and silver market.
The SPROTT PHYSICAL SILVER Trust seeks to provide a secure, convenient and exchange-traded investment alternative for investors interested in holding physical silver bullion without the inconvenience that is typical of a direct investment in physical silver bullion.
The Trust intends to invest primarily in long-term holdings of unencumbered, fully allocated,
physical silver bullion and will not speculate with regard to short-term changes in silver prices.