Why Gold & Silver ETFs replace your lockers

For centuries, families in India have stored wealth in gold jewelry, coins or silver bars. The idea was simple: tangible metal offered safety, value retention and an easy fallback in times of crisis. That cultural instinct has not disappeared. But investing in physical form brings his own series of challenges. These are storage, purity, liquidity and sometimes even emotional attachment that blinds financial judgment.

In recent years, Gold ETFs and Silver ETFs have emerged as modern avatars of these traditional assets. They retain the essence of noble metals, but pack them in a financial product that is transparent, liquid and much more practical. Thus precious metal ETFs are a cleaner alternative.

Gold: The anchor metal

Gold has always played the role of a stabilizer. Historically, it performed best during periods of economic stress, geopolitical shocks or falling interest rates. Value research data On 18 September 2025, the domestic gold prices that rise by 49.84% in the past year and an increase of 43.98% to the present (YTD), which is a reflection of its safe port-initiation power when worldwide uncertainty escalates. In the last period of 1 year, for example, the domestic stock market is flat (-0.39%) in the midst of global tariff wars and uncertainty.

With ETFs you can hold gold seamlessly in demat form and even buy small quantities. This prevents both the storage problems of jewelry and the illiquidity of coins and bars.

Silver: the cyclical metal

Silver has a different character compared to gold. It is more volatile, powered by industrial demand in electronics, solar panels and clean energy. That makes it a cyclical amplifier, who often performs better in reflational or growth phases. In the past three months, silver prices in India rose by 15.83%, which exceeded gold (10.67%) in the same period. For more than a year, silver delivered 43.47%, which shows how strong it can ride on industrial increases. However, volatility makes silver difficult in traditional form. Prices can swing sharply. ETFs solve the problem by offering Intraday -Liquidity and easy diversification. In this way, investors can adjust expansions without physical exchange or high transaction costs.

Why ETFs score on physical metals

Here are a few points to consider.

1. Liquidity and transparency: Selling physical gold often includes discounts, making costs or purity tests. Silver bars can be even more difficult to load at real value. ETFs, stated at trade fairs, trade in the vicinity of the actual market prices and can be liquidated immediately.

2. Lower costs: Jewelry transports costs, storage cabinets costs money and coins or bars can have mark-ups. ETFs charge a small management costs, but eliminate these hidden costs. This can increase considerably for longer periods.

3. Pureness and safety: When buying physically, purity continues to worry. ETFs are supported by standardized precious metal of high quality, stored with preservators. This removes the risk of counterfeiting or disputes about karats.

4. Tax efficiency: Frequent buying and selling physical metals causes capital gain at individual levels in the short term. Studies show that tax resistance can eradicate the compilation when investors try to balance DIY. ETFs, especially when it is held within a fund structure, make internal back in balance without immediate tax expenditure. This retains wealth more efficiently.

5. Diversity about cycles: Gold usually anchors portfolios, while silver cyclical swings increases. Often one leads while the other lags behind, although there are rare periods such as the past year in which both come together strongly. The challenge is that such phases are unpredictable and short -lived. Instead of trying to guess the turns, holding ETFs of both metals offers a more stable balance compared to stacking coins or bars in a safe.

Conclusion

Precious metals will always have a place in Indian households. But the form of holding things. Physical metal is cumbersome, sometimes inefficient and not always tailored to financial goals. ETFs bring the same store of value and cyclical benefits to a structure that is cost -effective, liquid and transparent.

For investors who respect tradition, but still want modern efficiency, Gold ETFs and Silver ETFs are a pragmatic and modern bridge.

When choosing ETFs, investors must assess the cost ratio, follow -up error, trade liquidity. Selecting ETFs with a good track record also helps. These factors influence long -term returns and determine how closely the ETF reflects the metal prices.

(The author is a strategy for principal investment, icici prudential AMC)

((Indemnification: Recommendations, suggestions, views and opinions of experts are their own. These do not represent the views of economic times)