For centuries, Indian households have turned to gold as a trusted store of value and a potential shield against economic instability. This deep-rooted tradition spans across genders and economic backgrounds. However, in today's complex and rapidly changing economic landscape, relying solely on one precious metal might limit an investor's potential for growth and protection.
The Distinct Roles of Gold and Silver in a Portfolio
Financial experts now suggest that a forward-looking strategy incorporating both gold and silver could build a more robust and adaptable investment portfolio. While both are classified as precious metals, they often perform different functions. Gold is widely viewed as a stabilising anchor, typically holding its value and providing relatively stable returns during periods of geopolitical tension, market volatility, or general unrest.
Silver, on the other hand, plays a more dynamic role. It is a highly cyclical metal with substantial industrial applications. Over half of global silver demand originates from industries like solar panel manufacturing, electric vehicle production, and consumer electronics. This strong industrial link means silver prices often rise during periods of economic expansion, positioning it as a potential tool for capitalising on growth.
Creating a Multi-Regime Diversification Strategy
The core benefit of combining these two metals is diversification that can adapt to various market conditions. This dual approach aims to mitigate the 'regret risk' associated with trying to predict which metal will outperform at any given time. Instead of timing the market, holding both assets allows an investor to potentially benefit from the stability of gold and the growth-oriented characteristics of silver simultaneously.
For the average investor, directly purchasing and storing physical metals or managing allocations across two separate Exchange Traded Funds (ETFs) can be logistically challenging and costly. Recognising this need, asset managers are introducing simplified solutions.
The Mirae Asset Gold Silver Passive FoF: A Streamlined Approach
The Mirae Asset Gold Silver Passive FoF is an open-ended fund of fund scheme designed to offer a professionally managed route to this two-metal strategy. It primarily invests in units of the Mirae Asset Gold ETF and the Mirae Asset Silver ETF.
This fund offers several key advantages. It handles the internal rebalancing between gold and silver seamlessly, based on data-driven signals such as market trends, momentum, and macroeconomic factors. This systematic approach helps remove emotional bias from investment decisions. Furthermore, the fund can adjust its allocation between the two metals without triggering a capital gains tax event for the investor, offering a potentially tax-efficient structure.
For investors aiming to modernise their approach to precious metals, this fund presents an opportunity to gain balanced exposure. The New Fund Offer (NFO) closes on August 25, 2025. The scheme will reopen for continuous repurchase and sale from September 1, 2025. The minimum investment amount during the NFO period is ₹5,000.
Investors are strongly advised to consult with their financial advisor or mutual fund distributor before making any investment decisions. This article is for informational purposes only.
