US Fed Chair Powell subpoenaed - silver and gold both hit NEW all time highs. Index buying driving silver stocks? plus one new announcement…

Disclosure: S3 Consortium Pty Ltd and its associated entities may hold direct or indirect interests in securities referred to in this publication and may receive fees or other forms of consideration from entities mentioned. These interests and arrangements may create a potential conflict of interest in the preparation of this material.

The information contained in this communication is provided for general information purposes only and may relate to speculative investments. It does not constitute financial product advice, and has been prepared without taking into account your personal objectives, financial situation or needs. You should consider obtaining independent financial advice before making any investment decision.

Any forward-looking statements are uncertain and not a guaranteed outcome.

We had to double check this video wasn’t AI when we first saw it:

(source)

Basically, it’s the US Fed Chair Jerome Powell accusing the US government of putting forward a legal case for criminal charges against him... for refusing to lower interest rates.

The US Fed is meant to be independent and make decisions based on the state of the US/global economy alone.

But Trump wants rates lower to unleash growth and investment in the US...

The video was posted on X yesterday at ~11:32am AEDT.

Almost immediately, gold and silver started running and have since BOTH hit new all time highs.

(source)(source)

The past performance is not and should not be taken as an indication of future performance. Caution should be exercised in assessing past performance. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.

That was the market's reaction to a world where the US Fed’s independence is in question.

(or maybe to just how serious the Trump administration is about lowering interest rates quickly and aggressively)

What we saw yesterday was precious metals becoming the asset that the market runs into during signs of uncertainty...

With silver being the strongest mover...

Before we talk about what ETF and index buying is and how it is going to drive silver stocks to the next level...

Hot of the press: Our 2024 Small Cap Pick of the Year - Sun Silver (🇦🇺 ASX:SS1 | 🇺🇸 OTC: SSLVF) just released drill results from its project....

SS1 has the biggest undeveloped silver deposit on the ASX and the USA - a 539M ounce silver equivalent resource estimate.

And today’s hits all came in above the average grade of the existing resource...

(Good news for any future resource upgrades)

(read the announcement here)

The silver price touched new record highs of above US$86 last night

You can do your own maths on what every incremental increase of US$1 per ounce in the silver price means for the potential in-ground value of SS1’s 539M ounce silver equivalent resource estimate.

SS1 is the first of our silver stocks where we saw ETF and index buying...

Here is what that means and what it means for SS1 and our other silver stocks.

Index buying “floodgates” to open for silver stocks in 2026?

Since that Jerome Powell video came out, the silver price is up by almost 8%.

Until now, the silver rally has mostly been fueled by speculation of a lack of silver supply, structural deficits from mine supply and industrial demand underpinning demand...

Yesterday could have upped the buying pressure from the “Reserve asset” or “safety asset” crowd.

We think there is still a big wave of capital to come into the silver market.

Our long running theory has been that once the institutional money comes into silver, the generalist cash will too (mostly through ETF/passive index buying):

And we have already started to see that buying come through.

The “Sprott Silver Miners & Physical Silver ETF” is a Nasdaq‐listed fund that seeks to track a silver‐focused index by investing mainly in silver mining companies and some physical silver.

The fund is one of the biggest and well known names in the silver sector.

The Sprott silver ETF has been buying on market a few of our silver Investments (SS1, IVR, WCE and BKB - more on this in a second).

It’s biggest holding from our Portfolio for a few months has been SS1.

It's gone particularly hard and fast into one stock in recent weeks - IVR - more on that below.

The Sprott fund is named after Eric Sprott - a Canadian billionaire resource investor and fund manager.

Sprott is widely regarded as one of the most prominent silver “bulls” in the world, known for aggressively investing in physical silver and silver mining equities.

Which explains why his actions are closely followed in the sector.

(back in September last year, Eric Sprott personally invested ~$4M and is a 9.72% holder of our silver Investment RCM)

Sprott-branded precious metals investment vehicles have generally been the earliest moving funds into precious metals like silver and gold.

And if the silver price keeps running like it is (or even just stays where it is for a few months), we expect other funds should start following too.

Which is when things should get very interesting for silver stocks.

The Sprott Silver Miners & Physical Silver ETF shares daily updates on the silver stocks they hold (you can see it here, just scroll down to “holdings”)

We check this page almost every day (along with the silver price every hour) to see if any of our silver Investments are getting any Sprott ETF buying in them.

Here is what it looked like on December 19th 2025:

And the Sprott ETF has been busy over the last ~18 days...

Here is how their holdings in our Investments look as of the 9th of January 2026:

(data sourced from here)

There has been buying in all 4 of these stocks.

But especially IVR, with 41.5M shares (~33.1M added over the last 22 days).

MTH, RCM and AVM aren't in there (yet...?) but all three have had active institutional funds become major shareholders.

AND Eric Sprott personally invested in RCM back in September.

And this is just one, early moving silver fund - how many more silver funds are out there?

Or new silver funds with new capital that will be spun up if the silver price keeps running?

(we saw this last year in the gold sector - a number of new funds were set up to buy into the gold bull market)

What we do know is that It's generally “later stage” companies that attract active, passive and then index fund buying.

Usually the ETF/Index funds criteria favours bigger market caps, higher liquidity and more advanced “later stage” companies.

And as we saw just before the great 2020 to 2021 lithium bull run kicked off, it was the “later stage” lithium companies that were already advancing lithium projects BEFORE lithium became the hot commodity that performed the best.

We applied the lessons learned from the lithium run when adding silver stocks to our Portfolio, focusing on later stage projects, ideally already with defined JORC resources and even development plans (as opposed to early stage exploration stocks):

Here’s our 3rd October 2025 explainer of why we added a number of silver stocks in the prior weeks:

(source: why have we added so many silver stocks October 2025)

Most of our silver Investments are now doing enough daily trading volumes and creeping up in market cap to get on the radar of different types of funds.

The next thing we need is for the silver price to keep moving up or sideways.

IVR has caught Sprott’s attention - $50k to $6M position

In our Saturday note a few weeks ago we pointed out a ~34 million share bid on our Investment Investigator Silver (ASX:IVR).

(source)

At the time we thought it would have to be either:

• A strategic buyer building up a big position in the company QUICKLY
• A fat fingered, erroneous order from a stockbroker... OR
• Index buying from an end of year December rebalance...

Turns out it may have been the Sprott Silver Miners ETF.

Before our note that ETF held less than $50K in IVR stock.

Now, a few weeks later the ETF holds ~41,193,720 IVR shares worth ~A$6M.

(source)

So far, 4 of our Investments have made it into the Sprott Silver ETF - IVR, SS1, WCE, BKB.

Again here is the Sprott holdings across those names from today:

(data sourced from here)

SS1 could be a big winner because of its size

We expect SS1 to be a major beneficiary of passive/index buying too.

When we first Invested in SS1 a big part of our thesis was that its project being the biggest undeveloped project on the ASX would attract capital inflows to the stock.

That has since sort of played out.

SS1 was the first to see big buying from the Sprott ETF - which we first pointed out back in July:

(source)

Back then Sprott’s SS1 holding was worth ~US$600k...

Now the Sprott fund holds US$3.2M in SS1 stock - and if SS1’s market cap gets bigger, come the next rebalancing period, that position could grow:

(especially if we keep seeing news like today’s announcement from SS1)

(source)

MTH, RCM and AVM aren't in there (yet) but all three have had active institutional funds become major shareholders.

So we may not be that far off an index inclusion for them either.

WCE and BKB look like “entry-level” positions for the fund.

We will be watching to see if they build them up to similar size % holdings as SS1 and IVR.

See our silver e-book for a quick overview of each of our Investments:

(Download here)

So what will passive capital inflows mean for silver stocks?

Especially in a market where the silver price stays at current levels OR keeps going up?

We think 2026 will be the year of “index buying” in some silver names.

Index buying is basically where big pools of passive cash are allocated across pre-determined mandates.

I.e a silver miners ETF will put to work every single $ that comes into the ETF in silver mining companies that fit the funds “mandated criteria”.

Usually the ETF/Index funds criteria favours bigger market caps, higher liquidity and more advanced “Later stage”.

We applied the lessons learned from the lithium run when adding silver stocks to our Portfolio, focusing on later stage projects, already with JORC resources and even development plans (as opposed to early stage exploration).

(the lesson being that it was the companies progressing later stage lithium project BEFORE lithium became hot that performed the best during the lithium boom)

During 2022-2024, when not many people cared about silver, silver stocks traded amongst private high net worth and retail investors.

During this time silver company share prices moved when an individual on the register’s personal finances or emotions changed, rather than any progress that the company was delivering.

Then in 2025, towards the end of the year, we finally saw some consistent buying from active institutional investors - remember all the “cornerstone investments” into silver and gold names in the second half of 2025?

On the ASX it was names like Tribecca, Lowell, APAC, Jupiter Asset Management and Lion Selection Group.

We think this group of active money managers are just getting started too by the way.

Some have had their best years of performance and will surely be looking to roll some of those wins into new names (or double down on their existing investments).

These institutions are considered “active money managers” - meaning they allocate capital based on whether or not they like a stock.

Another (much larger) pool of global capital is stuck in “passive funds” which are essentially big pools of cash that automatically invest in stocks that fit their pre-determined criteria.

You may have heard of Exchange Traded Funds (ETFs) or Index Funds - those are all “passive” allocators.

We think that 2026 will be the year of passive capital coming into the precious metals space.

Most people don't have time to look at individual stocks.

Instead, people seeking silver exposure will most likely just buy whichever passive ETF or Index is easily accessible.

THEN that capital starts being “force allocated” indiscriminately into silver names (or into the metals directly which creates more demand for the physical).

The thing about passive investment strategies is that the capital gets spread across the sector - so there are price insensitive buyers, chasing a very small universe of silver stocks...

We expect to see more headlines like this in 2026:

(source)

The beauty of Index/ETF buying is that it's indiscriminate - once a stock fits the fund's criteria it HAS to buy that stock proportionate to the rest of its Portfolio.

For example, if SS1 starts to run and becomes a billion dollar stock (hypothetically), the ETF needs to adjust its position in SS1 to match the size of the company.

If a silver producer becomes the most valuable in the world, then the ETFs/Indexes need to make sure that is their biggest position etc etc...

With small caps, if we get retail buying that lifts a company’s valuation into that territory where it's investable for institutional investors (size and liquidity wise).

The instos can “take over the baton” and take the companies to levels where the indexes and ETFs are mandated to start buying.

The perfect storm will be buying from all three groups on the way up because of the size of capital flows into the sector.

Just imagine if Morgan Stanley’s Chief Investment Officer (CIO) is right and passive allocators start to adopt the 60% stocks, 20% bonds, 20% precious metals portfolio approach as opposed to the industry standard 60% stocks, 40% bonds approach.

(source)

That would almost 5X more capital flows into the silver sector...

(at the moment the average precious metals exposure for portfolios globally sits around ~5.7% - mostly made up of gold exposure). (source)

So how does index buying actually work?

Think of a market index like a basket of companies that fit a certain criteria, and represent that portion of the market.

This could be gold stocks, tech stocks, biotech stocks, stocks that meet a certain size criteria etc...

These indexes are used as a benchmark to measure how that particular segment of the market is performing.

Indexes (namely the stocks within an index) are generally bought by big institutional funds that just want leverage to a specifically themed basket...

The broader the basket, the more access to new capital.

The best basket for small to medium sized ASX listed companies to enter in their growth journey is the S&P All Ordinaries Index.

This is a group of 500 of the largest ASX listed companies by market cap, that meet the strict requirements for entry.

There are over 2,200 companies listed on the ASX fighting to deliver enough positive results growth to enter (or stay in) an index.

Similar to the English Premier League, a small company moving into the All Ordinaries index is sort of like a team being promoted from the Championship up to the Premier League.

(Source)

With promotion comes more attention, bigger crowds, comparison against better teams, more media and pundit coverage... and more money.

And the ultimate goal is to eventually be promoted to the top tier Premier League.

(The equivalent here would be the ASX top 20 - where you would be up against the biggest and best companies like BHP, CBA, RIO, WES etc)

Don’t expect to see any sub $10M market cap speculative companies in the All Ords, it’s generally reserved for developed companies.

Index inclusion (and exclusion) is calculated every quarter.

In these quarterly Index rebalances, some companies are promoted in... and others are relegated out - depending on how well they have performed.

For those stocks that get promoted - using our Premier League analogy again - the increased attention, the bigger crowds, comparisons to better teams, more media and pundit coverage... and more money usually means stocks are more prone to re-rates...

We have seen it happen before with a few of our stocks that made it into a coveted “index”...

What happens when a company enters into an index?

As we said above, going into the S&P All Ords Index is like entering the “bigger leagues”.

Generally a company recently added into an index will see:

• Increased liquidity in their stock
• Buying from index funds to manage the balances.
• More doors open to a different class of institutional investor - ones that can only invest in stocks that meet a certain criteria.

Some of our best ever performers at some point found their way into the indexes prior to delivering some strong performance.

In March 2021, Vulcan Energy Resources (ASX:VUL) was added to the All Ordinaries index:

The past performance is not and should not be taken as an indication of future performance. Caution should be exercised in assessing past performance. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.

Also Latin Resources (ASX:LRS), which went from our Initial Entry Price of 1.8c to a high of ~42c.

Here is where LRS got included in the All Ordinaries index:

The past performance is not and should not be taken as an indication of future performance. Caution should be exercised in assessing past performance. This product, like all other financial products, is subject to market forces and unpredictable events that may adversely affect future performance.

Both of those companies started run ups off the back of index inclusion.

And have subsequently held their value.

VUL is capped at $2.4BN and just secured ~$3.9BN in funding to develop its lithium project in Germany and LRS was acquired by the $15BN Pilbara Minerals for ~A$560M in Pilbara stock.

Index inclusion alone didn’t spark these rallies nor does it guarantee sustained price increases, but it played a part in adding “fuel to fire” as larger pools of capital become unlocked.

Most of our silver stocks raised cash in 2025 making the most of the market interest in silver names.

We think that with that cash they have the firepower to deliver material news... OR “fuel to the fire” per se.

Our silver and gold eBooks

Everything we have written above, also applies to gold stocks too.

In fact the scale of everything is multiplied for gold given its a much larger market.

We are invested in the following gold names - TTM, KAU, BKB, RML, HAR, BPM, PUR.

We have been going deep on the gold and silver markets for a few years now.

Back in early February last year, we collated what we’ve learned about gold and silver into this eBook:

(NOTE: this is different to the new silver focused eBook we released a few weeks ago)

In our February eBook we share what we have learned about gold and silver, including:

• Why gold and silver prices are surging
• A quick history of gold and silver
• What a “mega bubble” is - when the price of gold and silver reach “astronomical” levels due to severe inflation and currency debasement
• Is the world about to enter a gold and silver “mega bubble”?
• Six books we found helpful to understand the drivers behind gold and silver markets

(this eBook is more about precious metals in general, if you want some educational early year reading to learn more about the history of gold and silver)

(Download here)

New silver eBook

In this eBook we share why we think the silver price has just started a “generational

price run”.

And why this silver price run we are predicting will take ASX silver stocks with it.

We’ll also share a quick overview of the 8 ASX silver stocks we are Invested in.

(if you want to know them right away their ASX codes are SS1, BKB, MTH, RCM, AVM, IVR,

WCE, PFE) - more on each in the eBook.

(Download here)