Silver has, to some extent, rivalled gold’s safe-haven status during times of geopolitical tension. Gold has also reached record highs, hitting the Rs 1 lakh mark for 10 grams of 24-carat gold.

The recent surge in silver prices has attracted retail investors and driven inflows into silver funds, explains Satish Dondapati, VP and Fund Manager, Kotak AMC.

He adds that funds like Silver ETFs and silver FOFs offer a convenient way to invest in silver without physical ownership, broadening their appeal to a wider investor base.

According to goodsreturn.com, the price of silver in Mumbai stood at Rs 1,08,900 per kg. In the past two weeks, the price of silver rose almost 9 per cent, from Rs 1 lakh per kg to Rs 1.09 lakh per kg.

Meanwhile, silver futures were trading at $36.

“Silver’s surge to over $36 per ounce, marking a 13-year high, underscores a confluence of factors: robust industrial demand, particularly in solar energy and electronics, a persistent supply deficit, and shifting investor sentiment towards precious metals amid global uncertainties,” says Aksha Kamboj, Vice President, India Bullion and Jewellers Association and Executive Chairperson, Aspect Global Ventures.

What Should Investors Do At This Point? Fresh Buying Or Profit Booking?

Experts advise caution to investors during this bullish period.

Dondapati notes that current silver prices are at a 13-year high, and investing at these levels presents both opportunities and risks.

“The current market environment, including rising geopolitical tensions, demand-supply constraints, increasing industrial demand, and inflation concerns, might support the continued rise in silver prices in the long term,” he adds.

Kamboj agrees that while the outlook remains positive, with potential for further gains, caution is warranted.

She recommends “a balanced strategy considering partial profit-taking, especially during price rallies, while maintaining a core position for long-term growth can be effective.” Diversifying into silver-focused ETFs or physical holdings also offers strategic exposure.

Dondapati cautions investors to consider the inherent volatility of silver prices and interest rate sensitivity. He suggests that a diversified investment approach and consideration of long-term trends can effectively mitigate these risks.