The Global X Silver Miners ETF (NYSEARCA: SIL) delivered 158% returns in 2025 while the S&P 500 gained 15%. Silver miners crushed the broader market by more than 140 percentage points, turning a sleepy precious metals play into one of the year’s most explosive trades. The question is whether the structural forces driving this rally can repeat in 2026.
The Macro Case: Silver’s Supply Deficit Isn’t Going Anywhere
Silver surged past $60 per ounce in December 2025 on a structural supply deficit expected to persist through 2026. Industrial demand hit record levels in 2025, driven by solar panel manufacturing and electronics production. The Silver Institute projects industrial consumption will exceed 700 million ounces for the first time, while mine supply remains flat because most silver comes as a byproduct of copper and zinc mining.
The deficit matters because inventories at major exchanges have tightened significantly. When ETF flows accelerate and physical buyers compete for limited supply, prices gap higher quickly. For 2026, watch monthly industrial demand data from photovoltaic manufacturers and semiconductor producers. If solar installation rates maintain trajectory and electronics demand stays firm, the supply squeeze intensifies.
Interest rate policy adds another layer. The Federal Reserve’s expected rate cuts in 2026 would lower real yields, making non-yielding assets like silver more attractive. Several investment banks project silver could reach $55 to $88 per ounce by late 2026 if rate cuts materialize and the dollar weakens. That macro backdrop would support continued miner outperformance.
The Micro Reality: Concentration and Leverage Dynamics
SIL’s top three holdings, Wheaton Precious Metals (22%), Pan American Silver (12%), and Coeur Mining (8%), represent 42% of the portfolio. Wheaton posted 137% quarterly earnings growth in 2025, while Coeur delivered 242% growth. These are concentrated bets on a handful of producers whose fortunes move with silver prices.
The leverage ratio tells a nuanced story. SIL gained 158% while silver rose roughly 112% in 2025, producing a 1.4x leverage multiple. That’s conservative compared to historical norms where miners often deliver 2x to 3x leverage to the underlying metal. This suggests miners are being valued cautiously or there’s room for additional upside if silver continues higher.
Monitor quarterly holdings updates from Global X, published on the issuer’s website typically within days after quarter-end. Watch for shifts in the Wheaton position, as the streaming company’s business model provides leveraged metal exposure without operational risk. Also track the ETF’s expense ratio (currently 0.65%) and bid-ask spreads, which can widen during volatile periods.
The Alternative: iShares Silver Trust
The iShares Silver Trust (NYSEARCA:SLV) offers pure metal exposure without miner-specific risks. It carries a lower expense ratio (0.50%) and eliminates operational, jurisdictional, and management execution risks inherent in mining companies. If you believe in silver’s fundamentals but want to avoid amplified volatility of equity positions, SLV provides cleaner exposure. The tradeoff is you lose the leverage that made SIL’s 158% gain possible.
The most important macro factor for 2026 is whether industrial demand can sustain current consumption levels amid the ongoing supply deficit. The critical micro signal is how SIL’s top three holdings execute operationally as silver prices potentially consolidate after a historic run.