How to invest in silver — physical, ETF and other options

Why silver?

Silver is a precious metal with a dual character — it's both an investment asset (like gold) and an industrial commodity. Over 50% of silver demand comes from industry (electronics, photovoltaic panels, medicine), which distinguishes it from gold.

Silver vs gold

Ways to invest in silver

1. Physical silver — bars

Bars available in weights from 1 oz (31.1 g) to 1 kg and more. You buy from mints and dealers (Mennica Polska, Tavex, Goldsaver).

Advantages: full ownership, no counterparty risk Disadvantages: 23% VAT on bars, storage costs, spread (buy-sell difference 8–15%)

2. Physical silver — bullion coins

Investment coins (American Silver Eagle, Wiener Philharmoniker, Maple Leaf) have lower VAT — coins with legal tender status can benefit from dealer margin instead of full VAT.

Popular coins:

• American Silver Eagle (1 oz)
• Canadian Maple Leaf (1 oz)
• Wiener Philharmoniker (1 oz)
• Britannia (1 oz)

3. Silver ETFs

ETFs provide exposure to silver price without physical possession:

• iShares Physical Silver ETC (ISLN) — backed by physical silver
• WisdomTree Physical Silver (PHAG) — ETC on physical silver
• Xtrackers Physical Silver ETC — alternative

Advantages: no VAT, full liquidity, no storage costs, easy purchase through broker Disadvantages: no physical metal, management fee (0.2–0.5% annually), counterparty risk

4. Futures contracts and CFDs

Silver derivatives — for experienced investors only. Financial leverage means you can lose more than you invested.

5. Mining company stocks

Indirect exposure through stocks of companies like Pan American Silver, First Majestic Silver, KGHM (Europe's largest silver producer). Company-specific risk, but potential for higher returns.

Taxes on silver investments

• Physical silver: profit from sale after >6 months from purchase is exempt from PIT (treated as movable property). Below 6 months — PIT according to tax scale.
• ETF/ETC: standard capital gains tax 19% on capital gain
• VAT: 23% on bars, coins may benefit from margin (effective VAT lower)

How much silver in portfolio?

Most advisors recommend 5–15% of portfolio in precious metals (gold + silver combined). Silver alone — no more than 5–10% of portfolio, due to higher volatility.

Physical vs ETF — what to choose?

How Freenance can help

Freenance enables adding precious metals to your net worth tracking — both physical silver and ETFs. You see what percentage of portfolio metals represent, and monitor value in PLN in real-time. This helps maintain proper allocation and avoid overweighting one asset class.

👉 Track your investments with Freenance — freenance.io