Is the iShares Silver Trust a Buy After Falling Nearly 60% From Its High?

The iShares Silver Trust (NYSEMKT: SLV), the world's largest silver exchange-traded fund (ETF), is one of the easiest ways to invest in silver without buying the precious metal. It's sponsored by a subsidiary of BlackRock (NYSE: BLK), the world's largest asset manager, and has $26.4 billion in assets under management. It holds its silver bars in secure vaults in London.

SLV's price hit an all-time high of $109.83 per share on Jan. 29, 2026. That marked a 277% gain over its previous 12 months. But today, it trades at about $47. Let's see what caused that pullback -- and if it's still worth buying as a safe-haven play in this wobbly market.

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Why did silver's price soar and sink?

At the beginning of 2026, three catalysts were driving silver's price higher. First, many investors expected the Fed to cut its benchmark interest rates, which would weaken the U.S. dollar and make precious metals more valuable.

Second, the industrial demand for silver -- used in solar panels, electric vehicles, consumer electronics, and data centers -- caused market demand to outstrip supply. Lastly, declining ore grades, higher mining costs, and tighter environmental regulations prevented miners from producing enough silver. Nearly three-quarters of silver is actually produced as a byproduct of mining lead, zinc, copper, and gold, while the rest comes from dedicated silver mines.

However, the outbreak of the Iran war in February changed that narrative by driving up oil prices and exacerbating inflation. In response, the Fed raised its interest rates for the first time in three years in September -- which strengthened the U.S. dollar against precious metals. Rising rates also made fixed-income investments more attractive safe-haven investments than gold or silver.

The AI market, which drove much of the demand for industrial silver, faced greater challenges as higher rates made it more expensive to build new data centers. Several newly elected Democratic governors have also called for moratoriums on new data center permits.

Is it the right time to buy SLV?

Silver faces significant near-term selling pressure, but it should bounce back over the long term. The Democrats' takeover of Congress could force the Trump Administration to end its war in Iran, which would bring down oil prices, tame inflation, and prompt the Fed to cut rates. If that happens, the near-term headwinds for silver, gold, and other precious metals would dissipate.

If you plan to hold SLV for at least a few years instead of a few quarters, it could be a great time to accumulate more shares. It won't recover right away, but silver should remain a stable long-term hedge against the debasement of fiat currencies and other economic shocks.

Leo Sun has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends BlackRock. The Motley Fool has a disclosure policy.