It is an inverse leveraged product that seeks -2x the daily performance of the Bloomberg Silver Subindex. It achieves its target exposure through a combination of derivatives such as swaps and futures.

It suits professional traders who expect silver prices to fall in the short term or who want to hedge existing physical or spot positions.

It is a passively managed (index-tracking) ETF run by ProShares.

Using a combination of derivatives such as swaps and futures, the fund readjusts its 2x exposure, in the opposite direction of the daily return of the Bloomberg Silver Subindex, every day. Because of the daily reset structure, the target multiple is accurate only on a one-day basis, and the longer the holding period, the more the cumulative return can diverge from a simple -2x of the underlying index.

• Inverse leveraged exposure specialized in the direction of falling silver prices
• Daily reset structure based on derivatives

Assets under management (AUM) stand at $61.1M, and the total expense ratio is 0.95% per year.

As with comparable inverse leveraged commodity ETFs, derivatives costs and the daily reset structure keep fees higher than those of typical passive ETFs.

The fund moves opposite to the direction of silver spot and futures prices. Because of the daily reset structure, in highly volatile periods the gap versus a simple inverse multiple of underlying silver prices can accumulate.

Inflows tend to pick up when volatility rises in the precious metals market or when hedging demand grows, while trading interest tends to fade in stable market environments.

It is useful as a short-term directional bet and hedging tool when silver prices are falling, but it carries a high risk that compounding effects will magnify losses if held for the long term.

SCO, KOLD and GLL shown in the table are comparable -2x inverse commodity ETFs based on crude oil, natural gas and gold, respectively. Like this product, they share a daily reset structure and derivatives-based management. DULL is a higher-multiple inverse product that tracks gold at -3x, and DGZ is a non-leveraged inverse product that is exposed only to falling gold prices, without leverage. To bet on rising silver prices, you would need to separately consider a leveraged long product, which is the exact opposite position, and to gain exposure to physical or spot silver itself, a non-leveraged silver ETF can be an alternative.

Here are the points to review before investing in ZSL. Given the nature of an inverse leveraged structure, a careful approach is needed that considers not only directional forecasts but also holding period management and derivatives costs.

Because of the daily reset structure, the longer the holding period, the more the actual performance can diverge from a simple -2x return of the underlying index. In highly volatile periods, losses can occur even when you get the direction right, so continuous monitoring is necessary.

It can be used for short-term directional bets on falling silver prices or for short-term hedging of existing positions, but it is a specialized trading product that is not suitable for long-term holding.