Silver exchange-traded funds (ETFs) traded sharply higher on Tuesday, tracking the continued rally in silver prices across global and domestic markets after the metal touched fresh all-time highs.
On the NSE, Nippon India Silver ETF (SILVERBEES) jumped over 3% to trade around Rs 251, while ICICI Prudential Silver ETF (SILVERIETF) gained more than 3% to Rs 261.9. Zerodha Silver ETF (SILVERCASE) also rose over 3%, while Aditya Birla Sun Life Silver ETF (SILVER) was up close to 3%.
The strong move in silver ETFs mirrors the sharp rally in silver futures, which surged to record levels both globally and on the Multi Commodity Exchange (MCX). MCX silver futures hit an all-time high of around Rs 2,71,679 per kg earlier in the session, extending gains after a sharp rally in the previous trading session.
Global silver prices at record highs
Internationally, spot silver climbed to a fresh record high near $85.75 per ounce earlier in the day before easing slightly. The metal remains up sharply over the last few sessions, supported by strong safe-haven demand and improving investor interest in precious metals.
Gold prices have also remained elevated, trading near record levels above $4,600 per ounce, reinforcing bullish sentiment across the precious metals complex and lending further support to silver-linked assets, including ETFs.
Why silver ETFs are rallying
Market participants attributed the rally in silver ETFs to a combination of global uncertainty and macroeconomic developments. Rising geopolitical tensions, particularly in the Middle East, have increased demand for safe-haven assets. In addition, concerns around US monetary policy stability have pushed investors towards hard assets such as gold and silver.
Expectations of interest rate cuts by the US Federal Reserve have also supported silver prices. Lower interest rates reduce the opportunity cost of holding non-yielding assets like silver, making ETFs linked to the metal more attractive for investors.
Strong investor participation via ETFs
Silver ETFs have seen increased trading interest as they offer investors an easier route to gain exposure to silver prices without holding physical metal. With silver futures showing high volatility and sharp price moves, ETF participation has picked up alongside rising spot and futures prices.
As silver continues to trade near record highs, market participants will closely watch global macro cues, US economic data and geopolitical developments for further direction in silver prices and silver-linked investment products.
