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Gold & Silver
What Should You Do as Gold and Silver Break Records?
Gold and silver aren’t just some random shiny assets-they are financial barometers. When investors fear inflation, currency weakness, or geopolitical shocks, precious metals shine.
- In 2025, gold crossed $3,500/oz, its highest ever.
- Silver jumped 60% in the past year, powered by both safe-haven demand and industrial use in EVs, solar panels, and electronics.
For Gen-Z and millennial investors, the hot question is: Should you join the rally, hold tight or just lock in gains?
What’s Really Driving Gold & Silver Higher in 2025?
- Global Central Banks Cutting Rates
- When U.S. interest rates are lower, investors don’t lose much by holding assets like gold, making it more appealing.
- Global Central banks and especially in Asia, constantly add value to gold reserves.
- Geopolitical Risks and Currency Weakness
- Rising wars, trade tensions and growing concerns about global warming are forcing investors towards safe-haven assets.
- A weaker dollar makes gold/silver more attractive worldwide.
- Industrial Demand for Silver
- Silver is not just a safe haven- it’s a critical component in solar panels, batteries, and electronics.
- As the EV and renewable boom continues, silver demand has structural support.
Why Should Indian Investors Care?
- Already Gold-Heavy: Indian households hold an estimated 25,000+ tonnes of gold, mostly in physical form. Many portfolios are unknowingly overweight.
- Inflation Hedge: Metals provide balance when the inflation spikes in the markets.
- Volatility Risk: Jumping in right after a sharp rally often leads to disappointment if prices are correct.
Take the Charge: Do This
- Check Current Allocation:
- It’s wise to keep gold and silver at around 5–15% of your overall portfolio.
- If above that- rebalance.
- Profit-Taking Discipline:
- If you’ve benefited from this rally, book partial gains.
- Reallocate proceeds into equity/debt to restore balance.
- Future Allocation via SGBs/ETFs:
- New investments? Use SGBs for long-term (8 years, tax-free).
- Use ETFs for short-term tactical exposure.
- Silver Exposure:
- Keep it small (<5%) given volatility.
- Consider silver ETFs if available.
Decision Guide
- If You Already Hold Metals:
- Stay invested, but book partial profits if allocation >15%.
- If You Don’t Hold Yet:
- Start small via SGB/ETF SIPs-don’t chase with lumpsum.
- If You’re Overweight:
- Rebalance-metals should hedge, not dominate.
FAQs
Q1: Has the right time to invest in gold already passed?
- If you don’t have any allocation, don’t ignore it-but stagger entry via SIPs in ETFs/SGBs.
- If you’re already at 10–15% allocation, avoid chasing highs; let equities drive growth.
Q2: Should you book profits?
Yes, if gold >15% of your net worth. Trim back to your target allocation.
Taking partial Profits lets you secure some gains while still keeping your hedge in place.
Q3: What’s the best way to hold gold in India?
- Sovereign Gold Bonds (SGBs): Tax-free redemption at maturity + 2.5% interest.
- Gold ETFs: Liquidity + easy tracking.
- Physical Gold: Only for jewellery/consumption—avoid as investment due to making charges/storage.
Final Takeaway
Gold and silver are critical portfolio hedges, not wealth creators on their own. Use them to protect, not to speculate.
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