SLVP vs. PPLT: A Simple Guide to Choosing Your Precious Metals ETF

The move in precious metals has been nothing short of historic. Gold, the anchor of the rally, has surged 55% in 2025, breaking above $4,000 per ounce for the first time. This explosive gain wasn't random. It was driven by a powerful mix of macro forces: persistent trade tensions, fears of inflation, and a historic wave of central bank buying that saw demand over 50% higher than the previous four quarters.

When gold started its climb, the other metals followed. The rally has been a classic "catch-up" story, where silver, platinum, and palladium have played catch-up after years of underperformance. The numbers show just how far they've come. Through the end of the year, silver had soared 149% and platinum was up 149%. In fact, silver's gains have been 170% since the end of 2024, a staggering move that reflects its "high beta" nature-its price tends to amplify the moves of the broader metal complex.

The most telling consequence of this synchronized rally is the dramatic shift in relative value. The traditional story of silver being a cheap, high-growth alternative to gold has been upended.

. The ratio's collapse means silver's old "cheapness" relative to gold is a less clear story today.

This isn't just a one-metal story. The entire precious metals complex has been a top performer, with precious metals ETFs dominating the list of best-performing funds in 2025. The rally has been fueled by a broad search for safe-haven assets and inflation hedges, with investors looking for ways to express this powerful theme. Gold's historic run provided the initial spark, and the other metals have followed, creating a powerful, if complex, investment landscape.

SLVP vs. PPLT: The Core Difference in What You Own

The explosive gains we've seen in precious metals have made choosing the right ETF a critical decision. At the heart of the choice between SLVP and PPLT is a fundamental difference in what you're actually buying. It's a classic case of buying the metal versus buying the company that digs it up.

SLVP is an ETF that owns shares of mining companies. Think of it as a basket of stocks in the silver and metals mining business. This gives you leveraged, stock-like exposure to silver prices. When silver rallies, the profits of these mining companies often surge even faster, which is why SLVP has delivered such a powerful return. In the past year, it has soared 206.1%. However, this structure introduces company-specific risk. The fund's performance is tied not just to the price of silver, but also to the operational health, management, and financials of the individual miners it holds.

PPLT, on the other hand, is a physical ETF. It holds platinum bullion. Its goal is to track the price of the metal itself as closely as possible. You're buying a direct link to platinum, without any equity risk. This approach is more straightforward and aims for a purer commodity play. Its return over the same period has been strong at 135.6%, but it has been less volatile than SLVP's wild ride.

The risk profiles reflect this structural divide. SLVP's stock-like nature makes it more volatile, with a max drawdown of -55.56% over the past five years. PPLT, with its physical bullion backing, has seen a more moderate peak-to-trough decline of -35.73%. This difference in drawdown highlights the added business risk in SLVP's portfolio.

In short, SLVP offers a leveraged bet on the mining sector's success, while PPLT offers a direct bet on the platinum price. Your choice depends on whether you want to ride the wave of the metal itself or take on the higher-risk, higher-reward potential of the companies that produce it.

The Business Logic: What Drives Each Metal's Value

The explosive price moves we've seen are more than just a technical rally; they are a reflection of powerful, long-term demand stories for silver and platinum. Understanding these stories is key to separating a temporary pop from a sustainable investment case.

For silver, the value proposition is increasingly tied to technology. It's no longer just a shiny metal for jewelry or coins. Its unmatched electrical and thermal conductivity make it essential for the clean energy and digital revolutions. According to a recent report, global silver industrial demand is poised to grow further as sectors like solar energy, electric vehicles, and data centers race forward. Solar photovoltaics alone now account for nearly a third of silver demand, a massive jump from just a decade ago. EVs also require significantly more silver than traditional cars, with estimates showing a 67-79% increase per vehicle. This shift from a historical reliance on photography to a future built on tech and sustainability is what's driving the long-term industrial story.

Platinum's demand is more diverse, but just as critical. The largest segment is automotive, where it's used in catalytic converters to meet strict emissions standards. Demand here is expected to grow, even as the world electrifies, because stricter regulations often require more platinum per vehicle. Beyond cars, platinum is vital for industrial processes like making nitric acid, and it's a key component in fuel cell electric vehicles, where its catalytic properties turn hydrogen into clean energy. As one analysis notes, platinum's demand is spread across four core segments, with automotive and industrial uses making up the bulk. This diversity can provide a buffer against volatility in any single sector.

This brings us to a crucial point about relative value. The recent, synchronized rally has compressed the gold-silver price ratio to its lowest level since 2013. In simple terms, you can now buy far fewer ounces of silver for one ounce of gold than you could just a few years ago. This dramatically changes the investment calculus. For decades, silver was seen as the "cheap" alternative to gold, a leveraged play on gold's moves. That story is less clear now. The rally has been driven by silver's own powerful industrial demand, not just by its correlation to gold. The compressed ratio means silver's traditional "cheapness" relative to gold is a less reliable signal.

So, what does this mean for the long-term case? For silver, the business logic is about being a foundational material for growth industries. Its price is supported by a rising tide of demand from solar panels, EVs, and AI data centers. For platinum, the case is about being a critical, multi-use industrial metal with a diversified demand base, from car exhaust systems to clean hydrogen fuel cells. Both metals have moved from being mere stores of value to being essential inputs in the modern economy. That fundamental shift in their role is what supports their recent strength and points to a future where their value is increasingly tied to the health of the global industrial and technological landscape.

The Takeaway: Which ETF Fits Your Risk Tolerance?

So, which path is right for you? The choice between SLVP and PPLT boils down to a clear trade-off: leverage versus direct exposure. Both are high-risk plays riding a powerful trend, but they offer different ways to get there.

Choose SLVP if you're chasing the highest potential return and can stomach extreme volatility. This ETF is a bet on the mining sector's success, not just the price of silver. Its structure as a basket of mining stocks gives it a leveraged, stock-like profile, which is why it has delivered a staggering 206.1% return over the past year. But that comes with a cost: a much higher risk of a sharp drawdown, with a max drawdown of -55.56% over five years. You're accepting company-specific risks and higher fees (0.39% expense ratio) for the chance at outsized gains. It's the higher-risk, higher-reward option.

Choose PPLT if you want more direct, stable exposure to platinum and a lower-cost, less volatile ride. This physical ETF holds platinum bullion, aiming to track the metal's price as closely as possible. It offers a purer commodity play without the equity risk of mining stocks. Its return of 135.6% over the same period is strong, but its max drawdown of -35.73% shows it's less volatile. It also carries a higher expense ratio (0.60%) and a smaller asset base, but it provides a more straightforward link to the platinum market. It's the more stable, direct option.

The bottom line is that both are riding the same powerful wave of precious metals demand. The trend is supported by record central bank buying and a broader search for safe-haven assets. As one analysis notes, central bank and investor demand for gold is set to remain strong, averaging over 500 tonnes a quarter. That same demand dynamic likely supports the entire complex. However, a sustained strength in the U.S. dollar could act as a headwind for all these metals, as a stronger dollar typically makes them more expensive for holders of other currencies. Watch for shifts in that dollar pressure, which has been underfoot in recent days.

In the end, your decision hinges on your risk tolerance. If you want the maximum punch from the rally and can sleep through the turbulence, SLVP is the leveraged bet. If you prefer a steadier, more direct link to the metal itself and a lower-cost structure, PPLT fits that bill. There's no wrong answer, just different ways to play the same powerful story.