Motley Fool contributing writer Dan Caplinger explains silver streaming, the unique business model of Silver Wheaton (NYSE: SLW ) , whereby SLW offers financing to mining companies in return for the right to buy future production of silver at a discount.
In this video, Dan shares how adequately financed potential competitors might pose a threat to Silver Wheaton in the future.
Additionally, Dan reviews the pros and cons of SLW's policy of paying a cash dividend based upon 20% of cash flow.
Lastly, Dan describes how the effects of leverage may make owning Silver Wheaton more volatile than a more traditional alternative, such as investing in shares of iShares Silver Trust (NYSEMKT: SLV ) .
If you are looking for a company whose success is determined by the metals market, but doesn't involve itself in the risks of physically mining the metals, then Silver Wheaton provides a unique play on the future of silver. SLW has grown sales and net income every year since 2008, and also has increased competitive advantages over its limited peer group. To learn more about Silver Wheaton, click here now to access The Motley Fool's premium research report on the company.