1330568--2/26/2010--iShares_Silver

related topics

{interest, director, officer}

{cost, operation, labor}

Because the iShares are created to reflect the price of the silver held by the Trust, the market price of the iShares will be unpredictable. This creates the potential for losses, regardless of whether you hold iShares for a short-, mid-or long-term. The amount of silver represented by the iShares will continue to be reduced during the life of the Trust due to the sales necessary to pay the Sponsor s fee and Trust expenses. Without increases in the price of silver sufficient to compensate for such reductions, the price of the iShares will also decline and you will lose money on your investment in iShares. The Trust is a passive investment vehicle. This means that the value of your iShares may be adversely affected by Trust losses that, if the Trust had been actively managed, might have been possible to avoid. The price received upon the sale of iShares may be less than the value of the silver represented by them. The liquidation of the Trust may occur at a time when the disposition of the Trust s silver will result in losses to investors in iShares. There may be situations where an Authorized Participant is unable to redeem a Basket of shares. To the extent the value of silver decreases, these delays may result in a decrease in the value of the silver the Authorized Participant will receive when the redemption occurs, as well as a reduction in liquidity for all shareholders in the secondary market. The liquidity of the iShares may also be affected by the withdrawal from participation of Authorized Participants. Authorized Participants with large holdings may choose to terminate the Trust. The lack of an active trading market for the iShares may result in losses on your investment at the time of disposition of your iShares. If the process of creation and redemption of Baskets of iShares 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 iShares closely linked to the price of silver may not exist and, as a result, the price of the iShares may fall or otherwise diverge from NAV As an owner of iShares, you will not have the rights normally associated with ownership of other types of shares. As an owner of iShares, you will not have the protections normally associated with ownership of shares in an investment company registered under the Investment Company Act of 1940, or the protections afforded by the Commodity Exchange Act of 1936. The value of the iShares will be adversely affected if silver owned by the Trust is lost or damaged in circumstances in which the Trust is not in a position to recover the corresponding loss. Silver transferred to the Trust in connection with the creation of Baskets of iShares may not be of the quality required under the Trust Agreement. The Trust will sustain a loss if the Trustee issues iShares in exchange for silver of inferior quality and that loss will adversely affect the value of all existing iShares. The value of the iShares will be adversely affected if the Trust is required to indemnify the Sponsor or the Custodian as contemplated in the Trust Agreement and the Custodian agreement.

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1330568--2/26/2010--iShares_Silver_Trust