How a Leveraged ETF Amplified Silver’s Historic Selloff

Silver prices suffered one of their most violent selloffs on record on Friday, and a popular leveraged ETF tied to the metal ended up both a major casualty and an accelerant of the move.

The ProShares Ultra Silver ETF (AGQ), which seeks to deliver two times the daily return of silver, plunged roughly 60% in the single session, reflecting the brutal collapse in the underlying metal. 

Silver fell as much as 36% on the day and finished down over 26% for its worst loss in modern history.

Going into Friday, AGQ managed approximately $5.2 billion in assets. By the end of the trading day, that figure had fallen to roughly $1.9 billion.

The dramatic contraction in assets was driven almost entirely by performance, not investor flows. The fund saw just $7 million in net outflows on Friday, essentially a rounding error relative to its size. 

How AGQ Accelerated the Decline

AGQ uses futures and swaps to maintain 2x daily exposure to silver and rebalances every day to keep that leverage ratio intact. Without rebalancing, the fund’s leverage would drift, falling when silver rises and rising when silver falls.

As a result, the fund adds silver exposure after gains and reduces exposure after losses. This process occurs daily, but the scale of Friday’s move made the rebalance unusually large.

With more than $5 billion in assets heading into the selloff, AGQ had over $10 billion in silver exposure. As prices collapsed intraday, the fund was forced to shed billions of dollars’ worth of silver exposure during its rebalance window. Based on intraday price moves, the required selling was likely on the order of $3 billion.

That forced, mechanical selling likely contributed to the midday swoon in silver prices, when losses accelerated and the metal hit its low of the day.

Broader Context

Friday’s collapse followed an extraordinary run in silver prices. At its peak last week, silver was up roughly 63% year-to-date. After Friday’s selloff and continued weakness on Monday, when prices were down another 10% midday, silver is now up only about 7% for 2026.

Despite the dramatic reversal, the metal remains well above where it started last year, still holding onto its 148% gain from 2025.
Precious metals have a long history of manias and violent reversals, and the question of whether this move represents a blow-off top remains open. The coming weeks will determine whether Friday marked the end of silver’s parabolic rally or was merely a temporary setback.

What is clear is that leveraged ETFs can play an outsized role in short-term price dynamics, amplifying momentum in both directions.