Silver has been on a remarkable run over the past year, delivering returns of more than 76% and drawing in a large number of new investors who were earlier focused mainly on gold. While gold has always been considered a secure investment, silver’s recent outperformance has made it a strong contender in portfolios looking for both growth and protection.
A mix of global and domestic factors has pushed silver prices above ₹1,62,000 a kg. Record international rates, festive and wedding-season demand, the sharp depreciation of the Indian rupee, and the domestic shift towards a more affordable alternative to gold have all contributed to this rise.
Industrial demand has been the real game-changer. Nearly 60% of the silver used globally now goes into industries—particularly green energy. Silver, once associated mostly with jewellery, has become essential for electric vehicles, solar panels and 5G-related technologies. Low production in recent years has tightened supply further, pushing global prices to all-time highs. Rising geopolitical tensions have also nudged investors towards precious metals, placing both gold and silver back in focus as safe options.
For those considering silver, the investment choices today are far wider than before.
Investing in physical silver—whether in the form of coins, bars or household articles—remains the most traditional route. It is simple to buy and sell, though storage and making charges are unavoidable.
Another increasingly popular option is silver exchange-traded funds (ETFs), now offered by several fund houses. These can be bought and sold through the stock market at market-linked prices, offering low transaction costs and easy liquidity. Silver mutual funds, which invest in silver ETFs, also provide an affordable entry point through SIPs.
Digital platforms such as MMTC-PAMP and PhonePe allow investors to buy very small quantities online. While easy to trade, they operate outside the oversight of market regulators, which raises concerns about long-term safety.
Silver can also be traded on the MCX, India’s largest commodity exchange, which offers contracts in different sizes and maturities. Futures and options trading require only a margin amount, making it accessible to various investors. However, given the possibility of sharp gains and losses, small investors should approach this segment with caution. Exposure through shares of silver-linked companies—such as jewellers or mining firms—is another indirect route.
Looking ahead, both global and domestic conditions suggest that prices could continue to rise. But silver is also known for short-term volatility, making it a favourite among speculators. For long-term investors, buying gradually through SIPs or accumulating during temporary price dips could be a more prudent approach.