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How Reddit Traders Are Using an ETF to Bet on Silver

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Reddit Mania Spreads Through Market

The latest market frenzy fueled by retail investors is focused on silver, but many of the bulls aren’t actually buying the precious metal. Instead, they are pouring hundreds of millions of dollars into an exchange-traded fund known by its ticker, SLV. BlackRock Inc.’s iShares Silver Trust, the largest exchange-traded product tracking the metal, has experienced unprecedented inflows as traders attempt to force a shortage of physical metal that would push silver prices yet higher. As with GameStop Inc. and AMC Entertainment Holdings, the coordinated efforts of these buyers are leading to huge market moves, not to mention a challenge for those tasked with shifting metal bars around during a lockdown.

They’re reacting to posts on Reddit’s WallStreetBets forum encouraging traders to pile into silver. Although hard to determine the exact origin, comments began appearing on the Reddit page on Jan. 27 saying that banks have been keeping prices artificially low and urging users to buy into SLV. The surge of demand sent the precious metal’s price to an eight-year high and led to SLV’s best day of inflows on record.