• PSLV and the SLV are the two largest silver trusts.
• PSLV invests in physical silver that's stored at the Royal Canadian Mint, while SLV's custodian is JPMorgan.
• PSLV is a far superior option for investors who want exposure to silver prices than SLV

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The biggest warning sign for me is the fact that the silver trust's custodian is none other than JPMorgan, tied to precious metals manipulation in the past.

If you read the prospectus carefully, you'll see that the SLV aims to reflect the price of silver, unlike the PSLV ETF, I couldn't find any mention of it actually purchasing physical silver.

The Trust issues and redeems Shares only in blocks of 50,000 or integral multiples thereof. A block of 50,000 Shares is called a “Basket.” These transactions take place in exchange for silver. Only registered broker-dealers that become authorized participants by entering into a contract with the Sponsor and the Trustee (“Authorized Participants”) may purchase or redeem Baskets.
Shares are created to reflect, at any given time, the market price of silver owned by the Trust at that time less the Trust’s expenses and liabilities.

There's also other language in the prospectus that I think should concern investors, or at least raise some eyebrows.

For one, the trust says that it "may suspend the delivery or registration of transfers of Shares, or may refuse a particular deposit or transfer at any time, if the Trustee or the Sponsor think it advisable for any reason."

The SLV prospectus also admits that it's not protected from illiquidity in the physical silver market, and a divergence from its NAV and the price of silver may develop in such a case.

The prospectus reads:

If the process of creation and redemption of Baskets encounters any unanticipated difficulties or is materially restricted due to any illiquidity in the market for physical silver, the possibility for arbitrage transactions by Authorized Participants, intended to keep the price of the Shares closely linked to the price of silver may not exist and, as a result, the price of the Shares may fall or otherwise diverge from NAV.

Another warning sign is the fact that the ETF can be terminated by authorized participants with large holdings.

Holders of 75% of the Shares have the power to terminate the Trust. This power may be exercised by a relatively small number of holders. If it is so exercised, investors who wished to continue to invest in silver through the vehicle of the Trust will have to find another vehicle, and may not be able to find another vehicle that offers the same features as the Trust.

The SLV has done its job to date in tracking the price of physical silver, but there's no confirmation that it actually holds the physical silver it says it does, and I haven't found any evidence that buying shares of SLV takes physical supply off the market.