Silver’s Meteoric Rise Powers Leveraged ETF to Triple-Digit Gains

The price of silver surged to a fresh all-time high today, reaching $64.32 per ounce. This historic move has propelled the ProShares Ultra Silver ETF (AGQ) to triple-digit returns for aggressive investors seeking amplified exposure. The rally is being fueled by a confluence of factors: a recent 25 basis point interest rate cut by the U.S. Federal Reserve and acute physical shortages in key industrial sectors, including solar power and electric mobility.

Key Data Points:
* Spot Silver: $64.32/oz; Year-to-Date performance: +110.14% (as of today).
* Federal Reserve: Implemented a 25 basis point reduction in early December.
* Market Structure: Persistent supply deficits; declining LBMA/COMEX warehouse inventories; futures curve in backwardation.
* AGQ ETF: A leveraged fund designed to deliver 2x the daily performance of the Bloomberg Silver Subindex. It utilizes futures contracts and swaps to achieve this goal and does not hold physical silver bullion.

Two primary forces are behind the metal's explosive performance. First, the Fed's rate cut triggered an immediate shift in demand, pushing prices decisively above the critical $60 psychological barrier. Second, critically low stockpiles in LBMA and COMEX vaults are intensifying a tangible physical squeeze. Industrial consumers are now paying significant premiums for immediate delivery, a dynamic that forces the futures curve into backwardation and further tightens near-term supply.

These immediate pressures are compounded by a longer-term structural backdrop. The silver market is now in its fourth consecutive year of a supply deficit, a fundamental imbalance that has profoundly shaped its annual performance. Within this context, silver is significantly outperforming broader commodity indices.

Should investors sell immediately? Or is it worth buying ProShares Ultra Silver?

Mechanics of the ProShares Ultra Silver ETF

Investors should note that AGQ does not invest in physical silver bars. Instead, the fund seeks to replicate twice the daily return of its benchmark index through futures and swap agreements. Its portfolio is heavily concentrated in front-month contracts and counterparty swaps, a structure intended to manage credit risk. Despite the inherent volatility during roll periods, the ETF maintained close tracking during its recent shift from December 2025 to March 2026 contracts.

Is the current surge sustainable? The underlying market analysis points to clear technical and fundamental supports—namely, accommodative Fed policy coupled with physical scarcity—that underpin the bullish trend. However, the fund's ability to mirror these gains is also heavily influenced by the structure of the futures curve and the volatility encountered during contract rollovers.

Market Outlook

In the near term, the trajectory of silver and the leveraged ETF will be dictated by the behavior of the futures curve and inventory reports from key exchanges like the LBMA and COMEX. This is especially pertinent during the ongoing roll period into March 2026 contracts. AGQ offers investors magnified participation in silver's price movements, though the effects of leverage and the roll dynamics will continue to influence short-term volatility.