After selling about $34 million worth Sprott Physical Silver Trust(NYSE: PSLV - News) units, Sprott Assett Management founderEric Sprott made clear that he is still bullish on the white metal and invested all of the proceeds from sales of units of the fund back into silver or silver equities.
Sprott has been one of silver's most strident bulls as the metal has surged higher in recent months, and when news of his sales of units in the silver trust bearing his firm's name was released on Monday when silver was already under heavy selling pressure, investors may have speculated that silver was losing a key supporter.
That's not the case, Sprott says. He told the Globe and Mail that "Every dollar of money that was raised by selling shares of [the Trust]...was reinvested in silver or silver equities." While silver itself has surged in recent months, shares of silver miners have lagged, prompting Sprott to tell the Globe and Mail "silver shares have not done as well, which is almost shocking in a way, and it looked like there were opportunities in either getting some premium on Sprott Physical Silver Trust shares and buying silver or buying silver equities."
Sprott did not specifically identify what silver stocks he bought with proceeds from the sale of Sprott Physical Silver Trust units, but at the end of 2010, his firm held positions in silver miners Silver Wheaton (NYSE: SLW- News), MAG Silver (AMEX: MVG - News) and First Majestic Silver (NYSE: AG - News). The firm also held stakes in gold miners such as Yamana Gold (NYSE: AUY - News) and Eldorado Gold (NYSE: EGO -News). Sprott says he still holds around 25 percent of the total trust units between his funds and his charitable foundation, the Globe and Mail reported.
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