After a dramatic 8 week run-up in silver prices, the bubble burst last week on a sudden strengthening of the dollar.
Since March 1, the iShares Silver Trust (SLV) gained nearly 40% before rapidly returning to early March levels in less than a week.
Over the same time period, gold investors experienced a much tamer rise and fall. SPDR Gold Shares (GLD) was up nearly 9% before falling slightly last week to finish above early March levels.
One reason that silver is more volatile than gold is the relative size of the markets. According to the Wall Street Journal, gold has nearly four times the amount of tradeable futures contracts as silver.
– ETF MarketPro Staff
May 9, 2011