Barclays Global Investors Press Release on Silver ETF
LONDON (Dow Jones)--Barclays Global Investors, a unit of U.K.-based Barclays
PLC (BARC.LN), will file an application for the first silver exchange traded
fund with the U.S. Securities and Exchange Commission before the end of the
year, a spokeswoman told Dow Jones Newswires Wednesday.
Christine Hudacko said the product is still in the development phase but will
be ready for filing before the end of the year with a launch date likely to
follow in 2006.
"Once a filing is submitted to the SEC, if you look at how long it would take
after that, I would say about a year after the filing," said Hudacko.
Spot silver has risen 10% since the beginning of May from $6.75 a troy ounce
to recent levels around $7.43/oz, partly due to expectations such a launch was
imminent, analysts and traders said.
Paul Walker, chief executive of GFMS, a precious metals consultancy in
London, said anticipation of a silver ETF could account for as much as 50 cents
of the current spot price.
Although the market appears optimistic about the likelihood of such a launch,
some analysts said its success is far from guaranteed. ,p
"One of the first questions the SEC will ask will be the liquidity of the
silver market. In the case of gold there was more data to make them comfortable
about the liquidity in the market. In the case of silver, you're not looking at
huge liquidity," says Walker.
Others said there may be insufficient demand to ensure the viability of a
"We've never had clients coming to us gagging to get an ETF in silver," says
John Reade, analyst at UBS. "Do I think pension funds will buy silver? No,
because the market is too small and illiquid. If you want to buy silver you buy
it on Comex."
-By Emily Parkinson, Dow Jones Newswires; (4420) 7842 9410;