In recent news, Bank of America has identified four exchange-traded funds (ETFs) that provide attractive exposure to precious metals amidst surging gold and silver prices. These ETFs, including abrdn Physical Silver Shares ETF (SIVR), iShares Silver Trust (SLV), Invesco DB Precious Metals Fund (DBP), and abrdn Physical Precious Metals Basket Shares ETF (GLTR), have been rated as “more attractive” by Bank of America for their diverse range of precious metals such as silver, gold, palladium, and platinum.
According to CNBC, Bank of America’s research indicates that a portfolio with 40% exposure to broad commodities has outperformed a similar portfolio with U.S. Treasury bonds by 0.8% annually since 1945. Despite the strong performance post-Covid-19, long-term commodity returns remain near record lows, but the bank anticipates a reversion to the mean for commodities.
Jared Woodard, the bank’s ETF strategist, highlighted the potential for commodities to see significant growth, stating, “Commodities are still at all-time lows relative to financial assets, and this ratio would likely move higher in a sustained shift to a 5% world.” The bank’s commodity team is particularly bullish on silver, forecasting spot prices to reach $26.46 per ounce by the end of 2024 and $32.50 per ounce by the end of the following year.
In a time when investors are increasingly turning to precious metals, the focus on these ETFs comes as spot gold prices stall and silver, gold, and copper prices experience a breakout. This trend is notable for companies like Newmont (NEM), which play a crucial role in the precious metals supply chain. Investors are keeping a close eye on these developments as they navigate the shifting landscape of the market.
