ETFMG Prime Junior Silver ETF (SILJ - Free Report) topped the list of best-performing ETFs for the second consecutive month. It gained 12.4% in July.
Being an industrial metal, hopes of U.S.-China trade deal as well as solid better-than-expected retail sales continued to drive silver higher. Additionally, industrial demand for silver is on the rise, thanks to the ongoing growth in the global solar PV industry, rebound in global computer shipments, as well as new sources of demand for sensors used in IoT and OLED lighting. Notably, silver is used in a wide range of industrial applications. About 50% of the metal’s total demand comes from industrial applications, while 30% comes from jewelry/silverware/coins and medal manufacturers.
Further, the wave of Fed easing policy has pushed the dollar down against a basket of currencies and makes dollar-denominated assets attractive to foreign investors, raising the appeal for the grey metal (read: 5 Sector ETFs That Crushed the Market in July).
Let’s take a closer look at the fundamentals of SILJ.
SILJ in Focus
This product provides direct exposure to the silver mining exploration and production industry by tracking the Prime Junior Silver Miners & Explorers Index. It holds 32 stocks in its basket with higher concentration on the top four firms. Canadian firms take the lion’s share at 67.9%, while the United States and Peru take the remainder. The fund has managed assets worth $88.4 million and trades in a good volume of about 144,000 shares a day. It charges 69 bps in annual fees (see: all the Materials ETFs here).
Though most of the stocks in the fund’s portfolio delivered strong returns, a few were up in double digits last month. Below we have highlighted the five best-performing stocks in the ETF with their respective positions in the fund’s basket:
Best Performing Stocks of SILJ
Alexco Resource Corp (AXU - Free Report) : This company is engaged in mineral exploration, and mine development and operational activities primarily in Yukon Territory, Canada. It jumped about 49.1% in July. Alexco Resource currently has a Zacks Rank #3 (Hold) and VGM Score of F. The stock occupies the fourteenth position in the fund’s portfolio, making up for 2.1% share.
Fortuna Silver Mines (FSM - Free Report) : This company is engaged in the exploration, extraction, and processing of precious and base metal deposits in Latin America. It also delivered incredible returns of 31.9% last month. The stock has a Zacks Rank #2 (Buy) and VGM Score of D. Hecla Mining occupies the fifteenth position and makes up 2.1% of SILJ. You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
SilverCrest Metals (SILV - Free Report) : This company acquires, explores, and develops precious metal properties in Mexico. It primarily explores for silver and gold properties. The stock rose about 29.8% last month. It currently carries a Zacks Rank #4 (Sell) and has a VGM Score of F. SilverCrest Metals takes the tenth spot with 3.8% allocation.
Silvercorp Metals (SVM - Free Report) : This company is engaged in the acquisition, exploration, development, and mining of silver and related mineral properties in China. The stock occupies the seventh position in the basket with 4.4% share in the SILJ portfolio and gained 24.8% in July. Silvercorp Metals carries a Zacks Rank #3 and a VGM Score of F (read: 5 Top ETFs of Last Week That Defied Market Slump).
First Majestic Silver (AG - Free Report) : This company is engaged in the acquisition, exploration, development, and production of mineral properties with a focus on silver production in Mexico. The stock rallied 19.1% in July and takes the top spot in SILJ portfolio with 13.9% allocation. First Majestic has a Zacks Rank #3 and VGM Score of C.
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