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Gold & Silver ETFs Surge Amid Global Fears
27 Feb
Summary
- Gold prices rose 60-70% and silver over 100% in the past year.
- Central bank demand provides structural support for gold.
- ETF design eases access, but costs and tracking matter.
Investor interest in gold and silver exchange-traded products remains strong, fueled by significant price appreciation and ongoing global uncertainties. Over the past year, domestic gold prices have surged approximately 60-70%, with silver experiencing gains exceeding 100%.
Heightened geopolitical tensions, energy supply concerns, and currency volatility are prompting investors to seek capital preservation. Central banks globally continue to diversify reserves into gold, creating a fundamental demand floor and reinforcing investor confidence in its role as a reserve asset.
Furthermore, the design of ETFs and fund of funds (FoFs) simplifies entry for retail investors through features like intraday liquidity, transparent pricing, and systematic investment plans. However, Chintan Haria of ICICI Prudential emphasizes that long-term outcomes depend on factors such as expense ratios and tracking error, with higher Assets Under Management (AUM) generally indicating better liquidity and cost efficiency.
