"Here are some extracts from the prospectus which should give some pause for thought.

"If, as seems highly likely, fractional reserve banking is being carried out by the major bullion banks - HSBC and JPM being the two largest participants - then, if there were to be a significant squeeze on physical metal, the ETFs would be unlikely to get away completely unscathed as with any bank run. It's all hunky dory until the brown stuff hits the fan.

"There is much discussion about the veracity of ETFs in general, so caveat emptor is a doctrine to be observed.

"If the process of creation and redemption of Baskets encounters any unanticipated difficulties, the possibility for arbitrage transactions intended to keep the price of the Shares closely linked to the price of silver may not exist and, as a result, the price of the Shares may fall.

"The liquidity of the Shares may also be affected by the withdrawal from participation of one or more Authorized Participants.

"The Trust's lack of insurance protection and the Shareholders' limited rights of legal recourse against the Trust, the Trustee, the Sponsor, the Custodian and any subcustodian exposes the Trust and its Shareholders to the risk of loss of the Trust's silver for which no person is liable.

"The Custodian's limited liability under the Custody Agreements and English law may impair the ability of the Trust to recover losses concerning its silver and any recovery may be limited, even in the event of fraud, to the market value of the silver at the time the fraud is discovered.

"Because neither the Trustee nor the Custodian oversees or monitors the activities of subcustodians who may hold the Trust's silver, failure by the subcustodians to exercise due care in the safekeeping of the Trust's silver could result in a loss to the Trust."

Eoin Treacy's view Thank you for these excerpts. They help to highlight the difference between funds attempting to track the price of a precious metal and those actually holding the physical metal. ETFS has both the Silver Trust and the Physical Silver Fund. The latter holds the metal. The former attempts to track the DJ-~UBS Silver Total Return Index and is therefore a somewhat more risky proposition from the perspective of a long-term investor.

ETFS Physical Silver is listed in the UK in Pounds and US Dollars. They also have an Australian listing. To the best of my knowledge Sprott Physical Silver is the only fund in the USA holding the physical metal.