Ninepoint Silver Bullion Fund

The Ninepoint Silver Bullion Fund returned +3.17% (Series F CAD) in Q3 2026, bringing YTD performance to -13.21%.

NINEPOINT SILVER BULLION FUND – COMPOUNDED RETURNS¹ (%) AS OF SEPTEMBER 30, 2026 (SERIES F) | INCEPTION DATE: MAY 10, 2011

After a second-quarter correction, silver found its footing in Q3. It absorbed a Fed rate hike, a surge in bond yields and a stronger US dollar, and still finished the quarter higher. Just as importantly, the market spent the quarter working through the biggest bearish argument against silver, lower solar demand, and the supply deficit held up.

Price Performance: Back in Positive Territory

Silver ended September near $61/oz, up from its Q2 close of $58.59. It is still about half its January 29 record of $121.62, which leaves considerable room for recovery if conditions improve.

Silver began July near its Q2 lows, held back by the same forces weighing on gold: renewed US–Iran hostilities, higher oil prices, and rising expectations that the Fed would hike. A weaker-than-expected July payrolls report in early August changed the tone. Silver rallied strongly and outperformed gold, with the gold-silver ratio compressing to about 66 by the end of August. Silver tested the $70 level twice in late August, showing how quickly buyers return once the rate outlook eases.

September gave back part of the gain as the Fed hiked and Treasury yields and the dollar rose sharply together. Silver’s decline was steeper than gold’s 8.5% drop, which is typical of its higher sensitivity to rates. Even so, silver held above its Q2 close and ended the quarter with a gain.

Key Market Drivers

1. Fed Policy: From Pricing Risk to Actual Hikes

Silver traded on the same macro sequence as gold. The July FOMC held rates with three dissents in favour of a hike, Jackson Hole moved markets firmly toward a September hike, and strong August payroll and inflation data confirmed it. On September 16 the Fed raised its target range by 25 bps to 3.75%–4.00%, its first hike since 2023, and signalled one more before year-end. Silver is both a monetary and an industrial metal, so it tends to amplify gold’s moves. Its September decline reflected both the higher opportunity cost of holding a non-yielding asset and concern about industrial demand in a higher-rate economy.

2. The Solar Reset Is Now in the Numbers

The main bearish argument against silver this year was solar, and it was tested thoroughly in Q3. After two years of very high prices, panel manufacturers have sharply cut the amount of silver in each cell, and some are moving toward copper-based or silver-free designs. Metals Focus and the Silver Institute forecast photovoltaic silver demand of about 151 Moz in 2026, down from about 187 Moz in 2025, a decline of roughly 19%. In mid-August, J.P. Morgan went further, estimating solar silver demand could fall by around 30%, or roughly 60 Moz, and cutting its Q4 silver forecast accordingly. The key point for investors is that these cuts are now in published forecasts, and they reflect a one-time adjustment to higher prices rather than a decline in solar deployment, which continues to grow. Once that adjustment works through, silver demand from solar should once again rise with installations.

3. The Deficit Endures

The Silver Institute’s projected 2026 deficit of 46.3 Moz already assumes lower solar demand. By some estimates, even the deepest forecast cut would roughly halve the shortfall rather than eliminate it. That would make 2026 the sixth consecutive year of deficit, with roughly 762 Moz drawn from above-ground stocks since 2021. Growth in other industrial uses (AI data centres, power transmission, EVs and automotive electronics) continues to offset part of the solar decline. Mine supply, much of which is a by-product of base-metal mining, remains slow to respond to price.

4. Relative Value Has Reset in Silver’s Favour

The gold-silver ratio ended the quarter near 68–69. That is well above the levels reached earlier in 2026 and above the 50–60 range that has prevailed for much of the period since the 1970s. Some independent valuation frameworks now show silver as inexpensive relative to gold. Unlike gold, silver has no central banks buying on weakness, which is one reason it fell further in September. But that also means its price reflects lower expectations, so a turn in the rate cycle could shift the ratio quickly in silver’s favour.inflation risk rather than a healthy return to normal. This demand does not depend on rate cuts.

Outlook

Silver enters Q4 with rate expectations largely reset, its biggest demand concern now reflected in forecasts, and its price relative to gold attractive. We believe much of the bad news is already in the price.

The Fed is still the main near-term driver. The September hike was largely priced in, and recent US data have weakened the case for another immediate move. A Fed pause would remove the main source of pressure from Q3, and silver’s higher sensitivity to rates, which hurt it in September, would then work in its favour. Further tightening remains the key risk to watch.

Solar is now a question of efficiency, not volume. The market is adjusting to a world where solar capacity grows while silver use in each panel falls. That adjustment is now well understood and largely reflected in forecasts. Demand from AI infrastructure, grid electrification and EVs is less sensitive to price, and its share of the demand base is growing.

Supply remains tight. Six years of deficits have drawn down above-ground inventories that cannot be quickly rebuilt. Even a smaller deficit draws on a shrinking buffer. When investment demand returns, the market has less inventory available to absorb it, and that has historically been the condition for silver’s strongest rallies.

Relative value has improved. With the ratio back in the high 60s, silver is priced well below its relative value earlier in the year. If the monetary backdrop turns more supportive, silver has historically been the precious metal that responds most.

We view Q3 as a constructive quarter for silver. It absorbed the toughest macro backdrop of the cycle, worked through its biggest demand concern and still finished higher. The deficit persists, the demand base continues to broaden, and relative value has improved. We remain constructive on silver for investors with a multi-year horizon, while recognizing that its volatility cuts both ways.

Sincerely,
Ninepoint Partners

Sources: Silver Institute, Metals Focus, J.P. Morgan, Bloomberg, LBMA
All figures in USD unless stated otherwise.