Gold and silver at a turning point: Positioning for bull and bear cases with SGX-listed DLCs

This post was created in partnership with Societe Generale. All views and opinions expressed in this article are Beansprout's objective and professional opinions.

What happened?

Gold and silver have been among the best-performing major asset classes over the last year.

Gold climbed to a record high of about US$5,400/oz while silver rallied to a record high of over US$120/oz in January 2026. 

More recently, however, both precious metals have given back some of their gains. 

A firmer US dollar, expectations of higher-for-longer US interest rates and profit-taking after a strong rally have all contributed to the recent pullback.

But with precious metals at a potential turning point, investors may have very different views on what comes next. 

Some may see an opportunity to buy the dip, while others may expect further weakness or seek to trade shorter-term price movements.

In this article, we'll explore what's driving gold and silver prices, the different ways investors can gain exposure to precious metals, and how Societe Generale’s newly listed Gold and Silver DLCs provide another option for investors seeking tactical, short-term exposure.

Why gold and silver remain in focus

While gold and silver have pulled back from their recent highs, many of the factors that supported their rally remain relevant, serving different roles in a portfolio.

#1 – Gold: The traditional safe haven

Gold has long been viewed as a store of value during periods of uncertainty. 

It has historically attracted investor interest during times of elevated inflation, geopolitical tensions, and financial market volatility. 

Continued buying by central banks has also provided an additional source of demand in recent years.

However, gold prices remain sensitive to changes in interest rates and the US dollar, which can contribute to periods of short-term volatility.

#2 – Silver: A precious metal with industrial demand

Like gold, silver is considered a precious metal. 

But it also has significant industrial uses in areas such as solar panels, semiconductors, electronics, and AI infrastructure.

This means silver prices are influenced not only by investor sentiment, but also by the outlook for manufacturing and technology-related demand. 

As a result, silver tends to be more volatile than gold, creating both opportunities and risks for investors.

With both metals capable of experiencing price swings, investors may have different views on where prices could head next. 

The right investment tool often depends on whether you're investing for the long term or taking a more tactical position.

How can investors express a view on precious metals?

The way you gain exposure to gold and silver often depends on your investment objective.

If you’re looking to build long-term exposure, exchange-traded funds (ETFs) that track the price of gold or silver can provide a straightforward way to incorporate precious metals into a diversified portfolio.

But not every investor is looking to hold precious metals for the long term.

You may have a shorter-term view on the market. 

For example, you may expect gold prices to rise following a weaker-than-expected inflation report, or anticipate silver prices could fall if the US dollar strengthens. 

Or you may simply be looking to express a view around periods of heightened market volatility around major macroeconomic events, such as Federal Reserve meetings or geopolitical developments.

In these situations, you may consider tactical instruments that allow you to express either a bullish or bearish view on precious metals, such as Daily Leverage Certificates (DLCs)

One of the latest additions to the Singapore market is Societe Generale’s Gold and Silver Daily Leverage Certificates (DLCs), the first SGX-listed leveraged and inverse products linked to gold and silver.

Understanding Gold and Silver DLCs

Daily Leverage Certificates (DLCs) are exchange-listed products that allow investors to gain leveraged and inverse exposure to the daily performance of an underlying asset.

Unlike traditional investments where returns move broadly in line with the underlying asset, DLCs seek to magnify the daily price movements of the underlying. 

As a result, they are primarily intended for short-term trading.

Societe Generale’s Gold and Silver Daily Leverage Certificates (DLCs), the first SGX-listed leveraged and inverse products linked to the SPDR Gold Shares ETF (GLD) and the iShares Silver Trust (SLV).

The four newly listed products provide investors with both bullish and bearish exposure to gold and silver:

These DLCs reference the performance of the SPDR Gold Shares ETF (GLD) and the iShares Silver Trust (SLV) on a US market close-to-close basis, with the leverage resetting daily.

They are listed on the Singapore Exchange (SGX) and trade in Singapore dollars during SGX market hours, allowing investors to access leveraged exposure to gold and silver using their existing brokerage account without needing to trade directly on US exchanges.

How does daily leverage work?

The leverage offered by a DLC applies to the daily percentage movement of its underlying ETF.

For example, if the SPDR Gold Shares ETF (GLD) rises 2% from one US market close to the next, a 5x Long Gold DLC would be expected to gain about  10%, before fees and costs. Conversely, a 5x Short Gold DLC would fall about  10%.

Likewise, if GLD falls 2%, a 5x Short Gold DLC would gain about  10%, while a 5x Long Gold DLC would lose about 10% before cost and fees.

As you can see, leverage works both ways. 

While gains can be magnified when prices move in the anticipated direction, losses are equally magnified when markets move against your position.

Why might investors consider Gold & Silver DLCs?

Gold and silver prices can move in response to changes in interest rate expectations, inflation data, geopolitical developments, and shifts in investor sentiment.

For investors with a short-term view on these price movements, Gold and Silver DLCs offer a way to express either a bullish or bearish view using leveraged exposure.

#1 – If you have a bullish view on gold or silver

If you expect gold or silver prices to rise, Long DLCs allow you to gain magnified exposure to the daily price movements of the underlying ETFs.

For example, if the SPDR Gold Shares ETF (GLD) rises by 2% from one US market close to the next, a 5x Long Gold DLC would be expected to rise by approximately 10%, before fees and costs.

Similarly, if the iShares Silver Trust (SLV) gains 2%, a 3x Long Silver DLC would be expected to increase by around 6%.

This allows investors to express a stronger bullish view without committing a larger amount of capital to the underlying asset.

#2 – If you expect prices to fall

Not every investor expects precious metals to move higher.

For example, some investors may believe that a stronger US dollar or higher-for-longer interest rates could continue to weigh on gold and silver prices.

Instead of short-selling the underlying ETFs, investors can use Short DLCs to express a bearish view.

If GLD falls 2% over a trading day, a 5x Short Gold DLC would be expected to gain approximately 10%. 

Likewise, a 2% decline in SLV would result in a gain of around 6% for the 3x Short Silver DLC, before fees and costs.

This gives investors a listed way to potentially benefit from falling prices without borrowing or short-selling securities.

#3 – If you're trading around short-term market events

Gold and silver often react to major macroeconomic developments.

These include:

• US inflation data
• Federal Reserve policy meetings
• US employment reports
• Geopolitical developments
• Changes in commodity market sentiment

Rather than maintaining a long-term position, some investors may prefer to take tactical positions around these events based on their market expectations.

Because Gold and Silver DLCs provide leveraged exposure to the daily performance of their underlying ETFs, they may be used by investors seeking to capture short-term price movements. 

Understanding the impact of daily compounding

One important feature of DLCs is that their leverage resets daily.

This means the stated leverage applies to each day's performance of the underlying ETF, rather than over a longer holding period.

When prices trend consistently in one direction, the effects of daily compounding can work in an investor's favour.

For example:

*Illustrative example before fees and costs. (The information is for illustrative purposes only, and is not indicative of future performance. Such information does not constitute or form part of any offer, or invitation, to subscribe for or to sell, or solicitation of any offer to subscribe for or to purchase, the DLCs at the price shown.)

However, when prices fluctuate up and down, the outcome can differ significantly from simply multiplying the cumulative return by the leverage factor.

This is because gains and losses are calculated from a changing base each day.

What should investors know before trading Gold & Silver DLCs?

#1 – DLCs are designed for short-term trading

DLCs provide leveraged and inverse exposure to the daily performance of their underlying ETFs.

They are therefore primarily intended for investors looking to express a short-term trading view, rather than those planning to buy and hold gold or silver over an extended period.

#2 – Daily compounding can affect returns

One of the key features of DLCs is that the leverage resets every trading day.

As a result, returns over periods longer than one day may differ from simply multiplying the cumulative return of the underlying ETF by the leverage factor.

When markets trend consistently in one direction, daily compounding may work in an investor's favour. 

However, in more volatile or sideways markets, returns can diverge from what investors might expect based on the stated leverage alone.

The simplified illustration below shows how the compounding effect can differ in a trending versus a volatile market.

Trending market:

Sideways market:

*Illustrative examples before fees and costs. (The information is for illustrative purposes only, and is not indicative of future performance. Such information does not constitute or form part of any offer, or invitation, to subscribe for or to sell, or solicitation of any offer to subscribe for or to purchase, the DLCs at the price shown.) 

#3 – Leverage magnifies both gains and losses

Leverage can amplify returns when prices move in the anticipated direction, but it also magnifies losses if markets move against your position.

As with any leveraged product, investors can lose their entire investment, although losses are limited to the amount invested.

Investors should ensure they understand how DLCs work and whether they are appropriate for their investment objectives and risk tolerance before trading. 

More information on the product features and the associated risks of trading DLCs is available on Societe Generale's DLC website (dlc.socgen.com).

Beyond precious metals, Societe Generale also offers DLCs linked to major US technology stocks listed on SGX. 

Learn more about how investors use DLCs to express views on individual stocks such as the US Magnificent 7 stocks.

 #4 – Gold and Silver DLCs are for specified investment products (SIP) qualified investors only

Gold & Silver DLCs are designated as Specified Investment Products (SIPs) in Singapore. This means they are only available to investors who are qualified to trade SIPs under the Monetary Authority of Singapore's (MAS) requirements.

If you're unsure whether you're SIP-qualified, check with your broker before attempting to trade Gold & Silver DLCs.

What would Beansprout do?

Gold and silver can play different roles in an investment portfolio.

For long-term investors, they may help provide diversification, particularly during periods of market uncertainty. At the same time, both precious metals can experience significant price swings as macroeconomic conditions and investor sentiment evolve.

For investors with a shorter-term market view, Gold and Silver DLCs provide another way to express a bullish or bearish outlook, especially when both precious metals can experience price swings as macroeconomic conditions and investor sentiment evolve.

As SGX-listed products, DLCs can be traded through a regular brokerage account during Singapore market hours, without the need to access overseas exchanges directly.

However, it's important to remember that because DLCs provide leveraged exposure and reset daily, investors may use them for tactical positions rather than long-term investing.

Learn more about Societe Generale's new Gold and Silver DLCs on their website here

Disclaimer

This advertisement has not been reviewed by the Monetary Authority of Singapore. The views expressed under this article represent the personal and independent views of the author and do not constitute investment advice. The content of this article does not form part of any offer or invitation to buy or sell any daily leverage certificates (the “DLCs”), and nothing herein should be considered as financial advice or recommendation. The price may rise and fall in value rapidly and holders may lose all of their investment. Any past performance is not indicative of future performance. Investments in DLCs carry significant risks, please see dlc.socgen.com for further information and relevant risks. The DLCs are for specified investment products (SIP) qualified investors only.