How to invest in silver (without buying coins)
12 min read · Updated Jul 2026
- The practical way to invest in silver without coins is a physically backed ETC such as SSLN, which trades like a share and charges 0.20% a year.
- Buying physical silver in the UK adds 20% VAT on top of the price; an ETC avoids the tax because you never take delivery of metal.
- European fund rules mean silver products are ETCs rather than ETFs, but you buy and sell them in exactly the same way.
- Silver is far wilder than gold: our data shows a worst five-year fall of about 65% for SSLN against about 25% for gold.
- Precious metals are usually framed as a small satellite of 5 to 10% of a portfolio at most, with silver the smaller slice next to gold.
For most people outside the US, the practical way to invest in silver without buying coins is a physically backed silver ETC, an exchange-traded commodity you buy through your broker like any share. One of the largest and most established choices on the London market is SSLN, the iShares Physical Silver ETC, which charges 0.20% a year and is backed by real silver bars sitting in a vault.
There is a second, less obvious reason to skip the coins, at least in the UK: physical silver you take delivery of attracts 20% VAT, the UK's sales tax, the moment you buy it. The ETC route avoids that cost entirely because you never take delivery of any metal, and you can buy and sell in seconds with nothing to store or insure.
An ETC works almost exactly like an ETF, a fund that trades on the stock exchange like a share. This guide walks through the ways to own silver, what an ETC actually is, how to buy SSLN step by step, and what our own tracked data says about how wild a ride silver can be.
The ways to invest in silver, and why ETCs win for most people
There are four common routes into silver, and they mirror the routes into gold. Only one of them avoids both the storage problem and the UK's sales tax.
The four routes are:
- Physical coins and bars, which come with dealer markups both ways plus the hassle of storage and insurance.
- A physically backed silver ETC such as SSLN, a stock-exchange listed product backed by vaulted metal that you trade through your broker like any share.
- A silver-miner ETF, which holds shares in mining companies rather than silver itself.
- Silver futures, contracts to buy silver at a future date, which are professional instruments.
The first route carries a cost in the UK that bullion dealers rarely put in the headline: physical silver attracts 20% VAT on purchase. Investment gold is VAT-exempt under HMRC's VAT rules on gold, but silver is not, so the taxman takes an extra 20% on top of the metal's price the moment you buy a coin, before dealer markups and storage costs even begin.
Storing the metal in a bonded vault can defer the tax, but adds its own storage fees. VAT treatment also differs by country, Singapore for example exempts qualifying investment-grade bars, so check your local rules, but for UK buyers it is a heavy handicap.
The other two routes have quieter problems:
- Miner ETFs hold company shares, not silver, so they often move with the stock market rather than the metal, which defeats the purpose if you wanted a diversifier.
- Futures are leveraged, meaning they magnify both gains and losses, and they tend to quietly lose money each month when the expiring contract is swapped for the next one.
For most people the physically backed ETC is the sensible middle ground, and because you never take delivery of any metal, no VAT applies. That is the entire reason this guide can promise silver without the coins.
What a silver ETC actually is
A silver ETC is technically a debt security, a kind of tradeable IOU issued by a special-purpose company. Each note is backed by physical silver bars held in a professional vault by a custodian, a bank whose job is safekeeping the metal.
SSLN's backing consists of allocated bars, meaning specific numbered bars are set aside for the product rather than a vague claim on a shared pool. Its price tracks the LBMA silver price, the global benchmark for silver set in London.
Why is it called an ETC when everyone searches for a silver ETF? The answer is a European rulebook called UCITS, the regulatory standard behind mainstream European funds.
One of its core rules is diversification: a UCITS fund is not allowed to put everything into a single asset, and a product holding nothing but silver obviously breaks that rule, so it cannot be structured as a UCITS ETF. The industry's workaround is the ETC, a bullion-backed note that trades on the exchange exactly like an ETF.
In day-to-day use the difference barely matters: you search the ticker, see a live price, and buy and sell during market hours. SSLN is also Irish-domiciled and pays no income of any kind, worth knowing if you arrived from our accumulating versus distributing guide: whatever return silver delivers stays in the price and nowhere else.
Step by step: buying SSLN through your broker
Buying SSLN takes minutes once your account is ready. The whole process breaks down into four steps.
- Open a broker account with access to the London Stock Exchange, then fund it with a bank transfer, which usually takes a day or two. Interactive Brokers is a common choice for international investors because it covers the London market at low cost, but most brokers that offer UCITS ETFs also carry the major silver ETCs.
- Find the product by typing SSLN into the search bar, then check that the result reads iShares Physical Silver ETC and that the exchange shown is London.
- Pick the right currency line. Like many London-listed products SSLN trades in more than one currency, and its base trading currency is US dollars, so choose the line matching the currency you actually hold to avoid an unneeded conversion.
- Place a limit order, an order where you set the maximum price you are willing to pay, which protects you from paying more than the quote you saw. Enter the number of units, review the estimated total, and submit during London market hours for the tightest prices.
The trade settles within a couple of days, settling being the formal exchange of cash for ownership, and SSLN then sits in your portfolio like any share. There is nothing to store, insure or resell through a dealer, which is precisely the point.
Silver vs gold: what our data shows
The numbers below come from the fund data tracked on this site as of July 2026. They compare SSLN with SGLN, the iShares Physical Gold ETC from our gold guide.
Side by side, the two metals look like this:
- Fees: silver costs more to hold, at 0.20% a year for SSLN against 0.12% for SGLN.
- Risk: our data gives SSLN a risk score of 4 out of 5, against 3 for SGLN.
- Worst five-year drawdown, the deepest peak-to-trough fall from a high point to the following low: about 65% for SSLN against about 25% for SGLN.
- Five-year annualised return, meaning the average yearly growth rate: about 10.7% for SSLN against 17.9% for gold, so the extra pain bought no extra reward over this period.
Our one-year price series makes the rollercoaster vivid. Within a single year, SSLN climbed to roughly two and a half times its starting level at the peak, then gave back more than half of that peak value before the year was out.
The reason fits in one sentence: roughly half of silver demand is industrial, going into electronics and solar panels, so silver swings with the economy in a way gold does not.
One honest caveat: five-year figures depend heavily on the window you happen to measure, and none of this predicts the future. The educational takeaway is simply that silver is the more volatile of the two metals, which is why people who hold both typically hold less silver than gold. You can put SSLN next to SGLN or an equity fund in the compare tool.
Costs, taxes and risks to understand
The annual fee, called the TER or total expense ratio, is skimmed gradually out of the product's value, so SSLN slowly lags the silver price itself by that 0.20% a year. There is no separate bill, the drag is simply baked into the price.
The bigger structural point is that silver pays nothing, ever. A share pays dividends and a bond pays interest, but a bar in a vault just sits there, so your entire return depends on the price someone else will pay later.
Silver has spent long stretches below past peaks, and famously took more than 30 years to revisit its 1980 high. There is no income cushioning you while you wait.
On tax, three points cover most situations:
- A silver ETC avoids the UK's 20% VAT on physical silver because no metal ever changes hands.
- Gains when you sell may be liable to capital gains tax, the tax on profits from selling investments, just like shares.
- London-listed ETCs are commonly eligible for ISAs and SIPPs, the UK's tax-sheltered investment and pension accounts, though provider policies and national rules vary, so check yours.
None of this is tax advice. Currency adds one more layer: silver is priced globally in US dollars, so your real-world return combines the metal's move with the dollar's move against your home currency, whichever currency line you bought.
Finally, remember the wrapper. An ETC is a note secured on allocated metal, a different legal structure from the UCITS ETFs elsewhere in a portfolio, with issuer failure a remote risk because of that allocated backing.
How much silver belongs in a portfolio?
There is no universally correct number, but the framing you will hear most often is precious metals as a small satellite holding of 5 to 10% of a portfolio at most, with silver usually the smaller slice next to gold because of the volatility shown above. A 65% fall in a small satellite is survivable; in half a portfolio it is a disaster.
In practice, many long-term investors build the core from broad equity funds such as VWCE or IWDA, which hold thousands of companies across the world, and treat metals as seasoning rather than the meal. Skipping silver entirely is also a perfectly reasonable position.
Whatever allocation someone chooses, the useful discipline is rebalancing: once a year, trimming whatever has grown past its target weight and topping up whatever has shrunk. With an asset that swings as hard as silver, that routine turns volatility into a systematic buy-low, sell-high habit instead of a temptation to chase.
None of this is personal advice. The right mix depends on your own goals, your timeline and your appetite for the kind of swings silver has repeatedly delivered.
Try it yourself
These pages use the same live fund data as this guide, so you can check every claim yourself.
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Frequently asked questions
How can I invest in silver in the UK?
The realistic routes are physical coins and bars, silver-miner funds, a physically backed silver ETC bought through a broker, and silver futures, though futures are a professional tool; for most people the ETC is the practical one. SSLN, the iShares Physical Silver ETC, trades on the London Stock Exchange for a 0.20% annual fee, is backed by vaulted silver bars, and avoids the 20% VAT that applies to buying physical silver in the UK. Check your local rules if you invest from elsewhere.
Do you pay tax on silver?
In the UK, buying physical silver coins or bars attracts 20% VAT, which is a major drag before the price even moves; investment gold is VAT-exempt, but silver is not. A silver ETC avoids VAT because you never take delivery of metal, though gains when you sell may be liable to capital gains tax like any share, and holding it inside an ISA or SIPP can change that. Tax depends on where you live, so check your local rules.
What if I invested £1,000 in silver five years ago?
Per the data tracked on this site as of July 2026, SSLN returned about 10.7% a year over the past five years, so £1,000 would have grown to roughly £1,660 before currency effects. The catch is the ride: the same data shows a worst peak-to-trough fall of about 65% along the way, so the ending number hides stomach-churning swings. Past returns say nothing about the future.
What is the best silver ETF?
In Europe they are technically ETCs, not ETFs, because UCITS fund rules do not allow a single-commodity fund. All the physically backed products track the same silver price, so "best" mostly means cheapest and most liquid on your exchange. SSLN is one of the largest on the London market at 0.20% a year, WisdomTree and Invesco offer physically backed alternatives, and the US giant SLV is generally not available to UK and EU retail investors.
Is silver a better investment than gold?
They behave differently rather than one being better. Per our data, silver has been the wilder ride: a worst five-year fall of about 65% versus about 25% for gold, with a lower five-year annualised return over the recent period, about 10.7% versus 17.9%. Roughly half of silver demand is industrial, so it swings with the economy in a way gold does not, which is why many people who hold both keep silver as the smaller slice; this is an educational comparison rather than advice.
Does SSLN pay dividends?
No, silver generates no income, so there is nothing to pay out, and the same is true of every physically backed silver ETC. The entire return comes from changes in the silver price, minus the 0.20% annual fee. Income, if wanted, has to come from other parts of a portfolio, such as a distributing equity fund like VUSA.