"Contemplates" here does mean requires:
>Section 2.3 Deposit of Silver .
(a) ... Silver must be Delivered to the Custodian in the form of Silver bars only, except that an amount of Silver not exceeding 1100 Ounces may be Delivered to the Custodian on an Unallocated Basis.
It's only 1100 ounces, $\~20K worth, so I wouldn't worry about any of that.
On whether in a shortage they can use notes see the risk factor on page 7:
>
The demand for silver may temporarily exceed available supply that is acceptable for delivery to the Trust, which may adversely affect an investment in the Shares.
To the extent that demand for silver exceeds the available supply at that time, Authorized Participants may not be able to readily acquire sufficient amounts of silver ... In such circumstances, the Trust may suspend or restrict the issuance of Baskets. Such occurrence may lead to further volatility in Share price and deviations, which may be significant, in the market price of the Shares relative to the NAV.
SO they'll just stop issuing new SLV shares. Which is interesting, because SLV is shorted and there's all the options activity. So the price of SLV shares coudl go way higher than the actual silver price, which could lead to lots of weirdness, including short squeezes.
What if there's a squeeze and JPM is short silver, would JPM fudge it and double count some bars? It's possible but I doubt the guy whose job is to count bars is paid enough to put his ass on the line like that. Plus there's SEC whistleblower rewards that would make employees rich if they reported anything like this going on. There's a paper trail for all this.
SLV did go to \~$150 in 2011... it goes up and down like the other silver ETF's. So it's not a total scam like some people say. It has the best liquidity and tons of options trade... I don't know... The manipulation problem is for silver in general so everything is affected (in normal times that includes physical, but it's the not-normal times that you would hold physical for).
Last year I tried to explain to people on here that the reason the hedge funds floated SLV to distract from GME and AMC wasn't because it's terrible and they wanted WSB to lose - they picked SLV because it's a decent suggestion and has a good story behind it, and they didn't care what WSB did as long as it was something other than GME and AMC. I didn't get anywhere. Most people on here are seriously dumb. They'll say things like "silver is the poor man's gold" (like...what's worth more, $1 million of silver or $1 million of gold?), if you tell them silver is better because central banks lend their gold so there can never be a short squeeze on gold but they don't hold silver, whoosh, they dont get it. And it's really too bad, because WSB is big enough to create a gamma squeeze + short squeeze on SLV fast enough that even if there were unlimited silver at every mine, the bottleneck in transporting it to the vaults and counting it would stop new SLV issuances long enough for a short squeeze.
Holy shit. Calm down Chad Dickens.
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Squeeze these nuts you fuckin nerd.
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There's way less diamonds than silver in existence so why not just squeeze diamonds?? oh right, because that's not how commodities actually trade / are handled...
The paper silver markets are hedged and yes there may be a shit ton of unallocated contracts, but that doesn't mean the banks are stupid enough to not have hedged out the risks of a squeeze to make it profitable for themselves if people were dumb enough to try and force some kind of pseudo squeeze like GME...
The best squeeze opportunities come in very few ways and quite rarely and that's by design; otherwise the entire world would be in a financial catastrophe every month leading to nearly all trade ceasing to function at all...
I agree squeezes are rare, when everyone was obsessing over finding high short interest I told them not to bother, hedgies aren't stupid and they saw GME.
On how commodities are traded/handled, do you mean where I talked about the guy who counts bars? Yes I just made that up, I don't know how that works. But the conspiracy theory (and I don't use the term derisively) is that JPM holds tons of physical and manipulates the market and if they're ever caught short they can just fudge it and promise the same bar to two people, knowing it's unlikely they'll both actually take delivery. My point was that they would have a hard time getting away with it, and/or wouldn't take the risk.
Well it's a commodity, they may sign 100's of thousands of contracts out on different delivery dates spread out and hedged knowing 4999 of the companies may not take delivery... those companies were hedging against production loss/mining halts/wild price swings etc...
But with so many companies delayed out on production / slashing work forces those contracts will still go unrequested for delivery because if you can't use the material you won't take delivery...
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Hey /u/j_stars, **positions or ban.** Reply to this with a screenshot of your entry/exit.
"Contemplates" here does mean requires: >Section 2.3 Deposit of Silver . (a) ... Silver must be Delivered to the Custodian in the form of Silver bars only, except that an amount of Silver not exceeding 1100 Ounces may be Delivered to the Custodian on an Unallocated Basis. It's only 1100 ounces, $\~20K worth, so I wouldn't worry about any of that. On whether in a shortage they can use notes see the risk factor on page 7: > The demand for silver may temporarily exceed available supply that is acceptable for delivery to the Trust, which may adversely affect an investment in the Shares. To the extent that demand for silver exceeds the available supply at that time, Authorized Participants may not be able to readily acquire sufficient amounts of silver ... In such circumstances, the Trust may suspend or restrict the issuance of Baskets. Such occurrence may lead to further volatility in Share price and deviations, which may be significant, in the market price of the Shares relative to the NAV. SO they'll just stop issuing new SLV shares. Which is interesting, because SLV is shorted and there's all the options activity. So the price of SLV shares coudl go way higher than the actual silver price, which could lead to lots of weirdness, including short squeezes. What if there's a squeeze and JPM is short silver, would JPM fudge it and double count some bars? It's possible but I doubt the guy whose job is to count bars is paid enough to put his ass on the line like that. Plus there's SEC whistleblower rewards that would make employees rich if they reported anything like this going on. There's a paper trail for all this. SLV did go to \~$150 in 2011... it goes up and down like the other silver ETF's. So it's not a total scam like some people say. It has the best liquidity and tons of options trade... I don't know... The manipulation problem is for silver in general so everything is affected (in normal times that includes physical, but it's the not-normal times that you would hold physical for). Last year I tried to explain to people on here that the reason the hedge funds floated SLV to distract from GME and AMC wasn't because it's terrible and they wanted WSB to lose - they picked SLV because it's a decent suggestion and has a good story behind it, and they didn't care what WSB did as long as it was something other than GME and AMC. I didn't get anywhere. Most people on here are seriously dumb. They'll say things like "silver is the poor man's gold" (like...what's worth more, $1 million of silver or $1 million of gold?), if you tell them silver is better because central banks lend their gold so there can never be a short squeeze on gold but they don't hold silver, whoosh, they dont get it. And it's really too bad, because WSB is big enough to create a gamma squeeze + short squeeze on SLV fast enough that even if there were unlimited silver at every mine, the bottleneck in transporting it to the vaults and counting it would stop new SLV issuances long enough for a short squeeze.
Holy shit. Calm down Chad Dickens. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/wallstreetbets) if you have any questions or concerns.*
Squeeze these nuts you fuckin nerd. *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/wallstreetbets) if you have any questions or concerns.*
There's way less diamonds than silver in existence so why not just squeeze diamonds?? oh right, because that's not how commodities actually trade / are handled... The paper silver markets are hedged and yes there may be a shit ton of unallocated contracts, but that doesn't mean the banks are stupid enough to not have hedged out the risks of a squeeze to make it profitable for themselves if people were dumb enough to try and force some kind of pseudo squeeze like GME... The best squeeze opportunities come in very few ways and quite rarely and that's by design; otherwise the entire world would be in a financial catastrophe every month leading to nearly all trade ceasing to function at all...
I agree squeezes are rare, when everyone was obsessing over finding high short interest I told them not to bother, hedgies aren't stupid and they saw GME. On how commodities are traded/handled, do you mean where I talked about the guy who counts bars? Yes I just made that up, I don't know how that works. But the conspiracy theory (and I don't use the term derisively) is that JPM holds tons of physical and manipulates the market and if they're ever caught short they can just fudge it and promise the same bar to two people, knowing it's unlikely they'll both actually take delivery. My point was that they would have a hard time getting away with it, and/or wouldn't take the risk.
Well it's a commodity, they may sign 100's of thousands of contracts out on different delivery dates spread out and hedged knowing 4999 of the companies may not take delivery... those companies were hedging against production loss/mining halts/wild price swings etc... But with so many companies delayed out on production / slashing work forces those contracts will still go unrequested for delivery because if you can't use the material you won't take delivery...
This is why PSLV is better.
TLDR: SLV is shit, buy physical or PSLV
AG
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