Silver in a Long-Term Plan and German Tax Basics
Size silver as a small satellite, set rebalancing bands that fit physical costs, and understand the general German tax treatment of physical silver, ETCs, futures and shares.
What you will learn
- How to size silver as a small satellite next to gold using a risk view, not a price story.
- How to set rebalancing bands that fit the high costs of physical silver.
- The German tax basics for physical silver, silver ETCs, futures, CFDs and mining shares (general orientation, as of 2026).
- How to write a one-page personal silver checklist.
Explanation
Silver as a satellite
The Portfolio Construction course explains core-satellite portfolios and rebalancing bands. For silver, the key point is risk: if silver's volatility is about twice gold's (measure it as in lesson 8), a 2% silver weight can move the portfolio about as much as a 4% gold weight. One common approach is therefore to treat silver as a small satellite (a minor, optional position) beside a larger gold or broad core. This course does not recommend any amount; write down your own target and the reason for it.
Rebalancing rules for silver
Physical silver is expensive to trade: you buy at the ask with premium (and often VAT, which a private buyer cannot reclaim) and sell at the dealer's bid. So:
- Use tolerance bands (rebalance only when the weight leaves a range, for example 1.5% to 3% around a 2% target) instead of fixed dates.
- Top up with new savings rather than selling other assets, where possible.
- Before selling physical silver, check the holding period of each lot.
German tax basics
The Gold course and the course "Taxes for Investors & Traders in Germany in Depth" explain § 23 EStG (Income Tax Act) private sale transactions. Applied to silver:
| Product | General treatment (as of 2026) |
|---|---|
| Physical bars and coins | § 23 EStG: gain tax-free if held more than one year. Within one year: personal income tax rate, but tax-free if total private sale gains in the calendar year are below the €1,000 Freigrenze (exemption limit: at €1,000 or more, everything is taxable). |
| Physically backed ETC with a delivery claim for the holder | Often classified like physical metal (§ 23), based on the court rulings for gold products. Delivery may require a minimum amount, such as one kilogram. Check the product terms. |
| ETC without delivery claim, synthetic ETC | Capital income (§ 20 EStG): flat tax of 25% plus solidarity surcharge (26.375% in total, plus church tax if applicable), no holding period. |
| Futures and CFDs | Forward transactions under § 20 EStG, flat tax. |
| Mining and streaming shares | § 20 EStG; losses go into the separate share-loss pot. |
Losses from § 23 sales can only be offset against § 23 gains. The VAT you paid is part of your purchase cost.
A personal silver checklist
- Purpose: why silver, and why not only gold?
- Target weight and bands, based on volatility.
- Product: physical, ETC with or without delivery claim, shares, or leveraged products (which can lose money quickly).
- Costs: premium, bid, storage, insurance, product fees.
- Storage and counterparty: allocated, bar list, insurer.
- Tax: holding period per lot, wrapper, records of purchase dates and prices.
- Review date once a year.
Worked example
Hypothetical example: portfolio €100,000: other assets €90,000, gold €8,000, silver €2,000 (target 2%, band 1.5% to 3%). After one year: other assets +5%, gold +10%, silver +75%. Selling costs are excluded.
- New values: €94,500 + €8,800 + €3,500 = €106,800. Silver weight: €3,500 ÷ €106,800 ≈ 3.28%, above the 3% band.
- Target: 2% × €106,800 = €2,136. Sell €3,500 − €2,136 = €1,364.
- Gain share of the position: (€3,500 − €2,000) ÷ €3,500 ≈ 42.9%. Gain realised: €1,364 × (€1,500 ÷ €3,500) ≈ €584.57.
- Physical silver held 14 months: generally tax-free.
- ETC without delivery claim: €584.57 × 26.375% ≈ €154.18 if the Sparer-Pauschbetrag (€1,000 saver's allowance) is already used.
- Physical silver held only 10 months, plus a €600 crypto gain in the same year: total €1,184.57 ≥ €1,000, so all of it is taxable; at a 30% personal rate ≈ €355.37.
Common mistake
Practice activity
Hypothetical: portfolio €50,000: other €45,000, gold €4,000, silver €1,000 (target 2%, band 1.5% to 3%). Other assets fall 10%, gold rises 5%, silver falls 40%. (a) Calculate the new silver weight. (b) Decide whether to act and calculate the amount. (c) Separately: you sell physical bars after 7 months for a €900 gain, with no other private sales. Is it taxable? What if you also had a €200 crypto gain?
Show solution
(a) €40,500 + €4,200 + €600 = €45,300; silver €600 ÷ €45,300 ≈ 1.32%.
(b) Below 1.5%: buy up to 2% × €45,300 = €906, so buy €306, ideally from new savings.
(c) €900 is below €1,000: tax-free. With €200 crypto: €1,100 ≥ €1,000, so the whole €1,100 is taxable at the personal rate.
Limitations: real rebalancing also pays premiums and spreads, and tax depends on your full situation.
Key takeaways
- Size silver by its risk: a small weight carries a large share of precious-metal volatility.
- Use wide bands and new savings to rebalance physical silver.
- Physical silver: § 23, tax-free after more than one year; ETCs without delivery claim, futures, CFDs and shares: § 20.
- Keep a written checklist and check tax questions with a Steuerberater.
Next step
To read silver and other markets with more precision, continue with the course "Technical Analysis in Depth".
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