Surge in Silver and Base Metals Trading Triggered By Amplify ETFs Acquisition
Silver and base metals experienced significant buying activity yesterday, attributed to the completion of Amplify ETFs’ acquisition of ETF Managers Group (ETFMG) exchange-traded fund (ETF) assets. The acquisition, involving over $3.7 billion in assets under management (AUM) across 14 ETFs, has propelled Amplify ETFs to manage an impressive $9.1 billion in AUM as of January 26, 2024.
Christian Magoon, CEO of Amplify ETFs, expressed enthusiasm about this strategic move, stating, “The completion of Amplify’s first sizable ETF acquisition begins an exciting new chapter for our organization. Since 2016, Amplify has sought to develop innovative products that provide professionally crafted access to unique market segments and investment strategies.”
He further emphasized the growth potential, saying, “The addition of these ETFs is an extension of our existing product development mandate and allows Amplify to significantly grow its unique investor solution set.”
Amplify ETFs closed 2023 with record-high ETF AUM and outstanding shares, boasting a remarkable 36% growth on the year, outpacing the overall US ETF industry’s growth rate of 26%. This acquisition places Amplify in the top 13% of ETF sponsors.
William Belden, President of Amplify ETFs, highlighted their commitment to adding value to investor portfolios, stating, “While working through the transaction this past year, we remained committed to our overall mission of adding value to investor portfolios.”
Effective as of the close of business on January 26, several ETFMG ETFs have been reorganized into corresponding newly created exchange-traded funds of Amplify ETFs, reshaping the ETF landscape. The move includes renowned funds like AI Powered Equity ETF, ETFMG Travel Tech ETF, and ETFMG Prime Cyber Security ETF, among others.
However, the acquisition also brings attention to the repercussions on certain funds. Trevor Hall of Mining Stock Daily expressed skepticism, stating, “According to the moves in junior miners, the SILJ (ETFMG Prime Junior Silver Miners ETF) is a zero now. Not a real zero. But a zero for me. It’s dead to me.”
Additionally, concerns were raised about the target fund, which tracked the Prime Junior Silver Index. Amplify SILJ, the successor, now tracks the Nasdaq Metals Focus Silver Index. The change in index provider led to a ripple effect, impacting stocks such as Mako Mining (TSXV: MKO) and Sailfish Royalty (TSXV: FISH), previously in the former index but not in the latter.
In a twist of events, it was revealed that the former manager of SILJ faced SEC fines and industry barring due to fraudulent lending of securities from his portfolio fund. Amplify’s acquisition of ETFMG is seen as a strategic move to resolve the fallout from these issues.
The Mining Bartender also chimed in on the situation, remarking, “Speaking of jokes, why would anyone own $silj. I can’t believe that they removed @FireweedMetals after such a recent addition to their index. Good news is that $fil.to (Filo Corp.) (also kicked off an index) & $fwz.v (Fireweed Metals) are both on sale with world-class assets.”
Information for this story was found via the sources mentioned. The author has no securities or affiliations related to the organizations discussed. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.
