Gold vs Silver: Silver has now surpassed its traditional identity. Earlier it was only known as a precious metal, which was used in jewelry. But, now this silver is also attracting investors, who are understanding its industrial use and importance of green technology. Now efforts towards green energy are intensifying all over the world. Experts say that silver is now emerging as an asset diversifying portfolio due to industrial demand and investment price.
According to Shruti Jain, Chief Strategy Officer of Arihant Capital Market, Silver’s real strength is in her dual role. He says, ‘Silver’s appeal is not limited to its precious metal identity just. It is used in areas such as solar energy, electric vehicles and electronics. This creates the role of strong silver structural demand.
Statistics also with silver
According to AMFI data, the asset under management (AUM) of Silver Exchange-Treded Funds (ETFs) in India has increased by 125% in the year end on May 2024. In comparison, Gold ETFS gained only 19.4% in the same period. This difference clearly shows that the silver is now seen from both investors Tactical (short -term strategy) and themetic perspective.
Shruti Jain says, ‘Silver has a major reason for this new trend in clean energy. This is an important input in solar panels, as its conductive and efficiency is very high. As governments are moving towards energy transition, Silver will get direct benefit.
Role in diversification
The investment case of silver is also stronger than the fact that its correlation with the stock market is comparatively low. This makes it a better diversification tool. Jain says that now many retail investors are exploring Silver ETFS for this reason.
Jain says, “We are seeing that investors are using silver tactically at the time of wallets. But, it is also being used strategically. Especially, as an alternative to exit from traditional equity-det allocation.”
There is risk, but also a chance
Risk is also associated with silver. Its prices fluctuate more than gold, so it is still not considered a ‘safe haven’ asset like gold. But Jain believes that this walletness can be beneficial for a particular type of investors.
He said, “Silver’s wallet can be useful for young people or more risk -taking investors who want exposure to global macro themes such as green infrastructure in long term.”
Easy to invest in silver from ETFS
The access and transparency of Silver ETFS is helping to increase investors’ participation. Investors can easily invest in silver through these funds. They do not need to purchase silver and keep them physically. This has made it much easier to include it in long term portfolio.
Gold or silver or both?
Jain suggests that investors should decide to invest in silver and gold by looking at their financial goals and the ability to take risks. He said, “Gold is still a source of more liquid and capital preservation. But silver can also become a good option. Especially for those who want to join industrial and technology-driving growth.”
According to him, gold and silver should be seen as complementary not to each other, not competitive. So that the portfolio remains balanced and full of possibilities.
Also read: Gold Rate Today In India: Now there will be more loose pockets to buy gold, silver also increased brightness, check the latest rate
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