Silver Verse Slv?

They're supposed to be lockstep. For trading, use SLV. For holding, buy fizzicals.

I've noticed that SLV tends to be a dollar or two lower than current spot price on Kitco. Any theories as to why?

You can't buy a loaf of bread with SLV!

Keep in mind, the "ease" of ETF taking just a few keystrokes is fine in "normal" markets. What happens if the big boys decide to go fizzical and grab all the available silver in five minutes, because there are 100 times as many oz under contract as there is silver to cover?

small diff is due to cost of running an ETF. Management overhead - storage, etc.

I trade SLV and PSLV, CEF, and SGOL.
If things really go haywire SLV and GLD will take the first direct hits.

I hold physical in my own safe location

SLV varies from spot due to ETF overhead (as already pointed out). It typically runs VERY close to lock step at the variation you quoted (I've been charting it for a year and while I haven't been using a magnifying glass on that detail, I've never observed it break above $1 variation). Since you enter and exit with the same variation, my experience has been it's a non-issue. IMO, it's a great way to invest in silver for short term scenarios and swing trades and is extremely liquid (you can buy or sell with a few mouse clicks).

As other mentioned, there are risks associated with long term investment. More likely than a run on the physical (which would leave you holding a worthless piece of paper, which is certainly possible) is the "big boys" dumping a large percent. Without going into too many details or stock jargon, a large hedge fund holding a lot of shares could single handedly cause a significant drop of SLV and even be the epicenter of a larger sell off. Physical silver /should/ be able to deflect much of this, certainly better than the SLV ETF, assuming worst case scenario.

I think the PSLV and PHYS ETFs are terrible. The elevator pitch is that it's backed (and accountable) by REAL silver and you can redeem your "paper" for "silver" upon demand. The catch: the NAV (Net Asset Value) carries a premium to buy into these-- ranging from a few percent to as high as 20% (significant fluctuation here as the market creeks and groans). The guy who runs these funds notoriously sells silver shares at said premium, then buys silver at spot price. He then reinvests the premium money into silver vehicles that don't charge a premium. This works out great for Sprott and his cronies, but not for the individual investor who doesn't enjoy the return. If you want physical, BUY PHYSICAL. Otherwise, you're paying much more than the next guy to feel good that your silver investment is backed up by "real silver."

If you want to play the trends and short term, SLV is a great investment vehicle. If you're buying and holding, I think physical silver is the best way to go.

Thanks for the explanation spacecoast_collector.