Silver Investment in India: Should You Add It to Your Portfolio? | JM Financial Services

Over the last few months, silver has caught the attention of investors. From May 22 to August 22, silver surged nearly 16.2%. In June alone, it climbed by 8%—that’s more than five times what gold delivered in the same month.

Zoom out further, and the trend continues. Over the past three years, silver has generated 26.5% returns, even outperforming gold’s 24%. Looks like the “younger sibling” of gold is starting to shine brighter. But why? And should you add it to your portfolio?

Why Is Silver Shining Right Now?

Silver isn’t just a precious metal—it also plays a vital industrial role. From powering solar panels and electric vehicles to enabling electronics and batteries, silver serves a dual purpose:

• Precious metal (investment demand)
• Industrial component (manufacturing demand)

This unique combination makes silver different from other metals.

The Flip Side: Silver’s Volatility

Despite its appeal, silver is notoriously volatile.

• In 2020, it surged 51%.
• The very next year, it dropped 10%.
• After the 2008 financial crisis, silver skyrocketed from ₹26,000 to ₹61,000 by 2011—only to face a decade of flat or falling prices.

This “moodiness” makes silver riskier compared to gold.

Silver ETFs: A Modern Way to Invest

To make silver investing more accessible, Silver ETFs (Exchange Traded Funds) were introduced in India in 2022. They allow investors to:

• Gain exposure to silver prices.
• Benefit from both industrial demand and investment demand.
• Hedge against inflation.

However, Silver ETFs come with challenges:

• Tracking errors – ETFs may not perfectly replicate silver’s market price.
• Liquidity concerns – Especially during times of market stress.

That said, the Indian market is growing. Three Silver ETFs have already crossed the ₹1,000-crore mark—a sign of increasing investor interest.

Should You Invest in Silver?

If recent performance has sparked FOMO, that’s natural. But investing decisions should not be driven by short-term returns.

Silver can play a role in a diversified portfolio, but it should not replace your core allocation to:

• Equities – For long-term wealth creation.
• Debt instruments – For stability.
• Gold and silver – Just a sprinkle for diversification.

As JM Financial Services emphasizes, smart investing is not about chasing the shine of the moment, but about building a balanced strategy aligned with your financial goals.

Bottom line:
Silver’s having a moment. But moments don’t build wealth. Strategies do.

FAQs on Silver Investment

Q1. Is silver a better investment than gold?
Silver has more industrial applications and higher volatility compared to gold. Gold is considered more stable, while silver offers higher return potential but greater risk.

Q2. What are Silver ETFs?
Silver ETFs are exchange-traded funds that track the price of silver and allow investors to gain exposure without holding physical silver.

Q3. Can I buy silver for the long term?
Yes, silver can be part of your long-term portfolio, but it should only be a small allocation due to volatility.

Q4. Are Silver ETFs better than physical silver?
Yes, ETFs are easier to buy/sell, safer to store, and more transparent than physical silver.

Q5. How can JM Financial Services help in silver investing?
With JM Financial Services, you can invest in Silver ETFs or explore precious metal strategies with expert research, portfolio allocation advice, and easy-to-use trading platforms.