Gold Miners or Silver Bars? We Compare VanEck Gold Miners ETF to iShares Silver Trust to Find the Better Buy

The choice between iShares Silver Trust (NYSEMKT:SLV) and VanEck Gold Miners ETF (NYSEMKT:GDX) depends on whether an investor seeks direct exposure to physical silver prices or equity-based exposure to gold mining companies.

While both funds serve as popular hedges within the precious metals sector, they operate on fundamentally different mechanics. The iShares trust tracks the spot price of the metal by holding physical bullion, whereas the VanEck fund provides indirect exposure by investing in a diversified basket of global mining companies that often exhibit higher volatility than the underlying metal.

Snapshot (cost & size)

Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield as of the close of July 15 trading.

The expense ratios for these two funds are nearly identical, with iShares Silver Trust charging 0.50% and the VanEck fund charging 0.51%. This minor difference of 0.01 percentage points is unlikely to be a primary driver for most long-term investors.

Performance & risk comparison

What's inside

The iShares Silver Trust provides direct exposure to the price movements of silver bullion rather than the companies that extract it. The trust is all in the silver metal, and holds the actual bars in secure vaults, offering a way for investors to track silver prices without the logistical challenges of physical ownership. It is not an investment company under the 1940 Investment Company Act and does not qualify as a commodity pool.

The VanEck Gold Miners ETF provides exposure to the equity side of the industry by tracking the MarketVector Global Gold Miners Index. Its sector allocation is 100% in basic materials. Top holdings include Newmont Corp (NYSE:NEM) at 10.5%, Agnico Eagle Mines Ltd (NYSE:AEM) at 10.5%, and Barrick Mining Corp (NYSE:B) at 8%. The fund holds 69 different mining stocks and was launched in 2006. These companies' profits are tied to gold prices, but their share prices are also influenced by production costs and exploration success.

Which fund is the better buy?

Each of these funds gives you access to one of the great commodity metals, gold or silver. But they are quite different.

Both gold and silver prices have been on a furious rally in the past few years. Gold has more than doubled over the past two years as investors have flocked to the yellow metal for its historic inflation-hedging characteristics. Silver has nearly tripled since the start of 2025, partly in tandem with gold and partly due to industrial demand from renewable energy applications.

Investors seeking exposure to the metal rally without the time and expense of buying physical commodities can buy the iShares Silver Trust ETF. The trust has had an exceptional past 52 weeks, with a nearly 67% return. 2025 really was the year for silver, with the trust returning 150% in the calendar year. But of the four years before 2025, two had negative returns for the ETF. And even while the Silver Trust is an easier way to buy physical silver, in the U.S., gains from this type of fund are taxed as collectibles, which typically means a higher tax rate than for stocks for most investors. Still, silver has been an overall winner despite the volatility: the ETF has annualized returns of 11.8% in the 10-year time frame.

Owning a collection of gold mining stocks, like the VanEck Gold Miners ETF offers, isn’t a pure play on the price of gold, but it tracks rather closely. Studies show that about 85% of the price movement of gold mining stocks has to do with gold’s price. The benefit for stock ETF holders is that when gold prices rise, they usually outpace operating costs. That’s because miners are pulling gold from the ground that they have already paid to acquire, while the royalties and other costs don’t rise as high. So in the early years of a gold rally, the higher prices flow mostly to the bottom line.

Performance-wise, these two funds are surprisingly close. GDX edges SLV with 37.5% 3-year and 19% 5-year returns, while slightly falling short of SLV in the 10-year.

The combination of dividend income, lower taxation in most instances, and the expectation that 2026 should be another banner year for gold miners despite the recent dip in the metal’s price makes GDX the ETF to buy.

For more guidance on ETF investing, check out the full guide at this link.

Brendan Coffey has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.