Eric Sprott has been busy offloading units in his Sprott Physical Silver Trust over the last few weeks.
It may be fortunate timing; the fund hit a record low today amid the vicious 5 per cent plunge in silver prices.
INK Research, which monitors insider buying and selling activity, points out to us that regulatory filings show Mr. Sprott sold $46,258,984 (Canadian) over the past 30 days in the trust. The sales to the public occurred almost daily in several transactions. (You can click here to see his last 10 transactions.)
The fund, which like the metal today is down about 5 per cent, has a market cap of about $1.3-billion. Ted Dixon, CEO of INK Research, notes that there has not been any indication of Mr. Sprott selling units in his Physical Gold Trust or in Sprott Inc.
When we asked Sprott for why the sudden burst of sales, here's what spokesman Glen Williams had to say: "The shares were sold by his charitable foundation to meet some of its obligations. The rest of the units were sold to buy shares in silver mining companies, which he believes will outperform the metal itself on the next rally."
Mr. Sprott hasn't been shy in expressing his views recently that both physical silver and precious metals equities are undervalued.
What silver equities he may be purchasing we don't know. But, according to fund data as of March 28, the top stock holding in the Sprott Canadian Equity fund was First Majestic Silver Corp., followed by Silver Lake Resources Ltd. The fund's top holding overall, however, was physical silver bars.
Mr. Sprott also sold large holdings of the units in the Sprott Physical Silver Trust back in 2011. At the time, he also stated the money was reinvested in silver metal or silver equities.
Sprott launched the fund in July 2010. The IPO was priced at $10 (U.S.).