A High-Yield Way To Profit From Silver Volatility

I want to lock in some profits on a small portion of the silver I hold in my OneGold account. When I went to place a trade, I was shocked to see how much the bid/ask spread had widened.

While most of my investing focus and recommendations to subscribers cover high-yield investing, I like the diversification of owning physical gold and silver. A OneGold account lets me buy, accumulate, and sell the physical metals in any quantity.

I have used my account to accumulate ounces of gold and silver over the last eight years. As prices went up, I sold small portions of my gold and silver holdings, locking in recent profits. When prices dropped, I looked for a good entry point to add ounces.

After the 2025 run-up in prices followed by a sharp downturn, it took the metals half a year to find what looks like a new, current price bottom. To take advantage of the building price support, I made several silver purchases to add ounces for less than $60 per ounce.

As silver reached $70, I wanted to sell a few ounces, lock in the recent profits, and recycle that capital into other opportunities. However, when I went to enter a sell order, I saw that the bid/ask spread had widened to about triple the usual amount.

With past orders, the spread, which consisted of the actual current spread and a premium charged by OneGold, was less than 5%, or less than $3.50 for $70 silver.

However, when I recently tried to sell some silver, the spread had blown out to $7.21 per ounce, or over 10%. This meant that buying would cost $71 per ounce, and selling would net a little over $65. Ouch!

When prices turn more volatile, dealers will widen their spreads to protect their margins. This is the widest spread for silver I have ever seen from OneGold. For comparison, the gold spread is 2.3%.

So I decided not to sell any silver. I remain confident that the price will move higher. And I will be willing to buy more ounces if silver drops back to $60 or so.

With silver volatility making buying and selling challenging, that same volatility can help funds that use covered call option strategies with silver as the underlying asset.

In my Dividend Hunter newsletter service, we have used the ETRACS Silver Shares Covered Call ETNs (SLVO) to earn monthly dividends based on silver option prices. SLVO’s structure means the dividends will accurately reflect actual option price levels.

So far into 2026 (eight months), the monthly dividend has averaged $4.70 per share. The 52-week mean share price is $84 per share. The dividend has averaged just over 5% per month. Hopefully, the September dividend will turn the recent volatility into another nice monthly payout.