Synopsis: With the import duty on gold and silver being increased in India, bullion ETFs have surged in value, creating a strong investment theme in the market, namely Gold ETFs and Silver ETFs. This article will discuss the top Indian gold and silver ETF to invest in amid the hike.
Domestic gold and silver prices have rallied sharply in response to the recent sharp hike in import duties by the Government of India in the precious metals.The import duty hike by the Government of India has resulted in a strong rally in domestic precious metals prices and domestic exchange traded funds (ETFs). The government has raised the customs duty on precious metals from 6% to 15% which will make imports costlier and therefore boost the demand for market linked investments such as Gold and Silver ETFs.
As the global markets are constantly volatile and the cost of physical gold is getting higher, Gold and Silver ETFs have once again become the preferred investments options for Indian investors looking for liquidity, transparency and a convenient way to gain exposure to precious metals.
Why Gold & Silver ETFs are Rallying after Tariff Hike
India is highly dependent upon imports, so any increase in duties would be directly reflected on the landed value of precious metals. After the announcement, the prices of gold at the MCX rose by almost 6–7% and silver rose by more than 8%, causing the Gold ETFs and Silver ETFs to move 5% to 15% in one day. Additionally, investors are opting for ETFs over physical metals because of their ease of access and lower cost.
Top Gold ETFs to Invest
1. Nippon Gold ETF(BEes)
- NAV:132.10
- AUM: ₹55,540 Cr
- 1Y: 60.84%
- 3Y: 33.84%
- 5Y: 24.45%
- Expense ratio: 0.8%
- Min SIP: ₹500
2. ICICI Pru Gold ETF
- NAV: 136.68
- AUM: ₹26,381 Cr
- 1Y: 55.61%
- 3Y: 34.18%
- 5Y: 24.81%
- Expense ratio: 0.49%
- Min SIP: ₹500
3. SBI Gold direct plan growth
- NAV: 48.57
- AUM: ₹15,691.06 Cr
- 3Y: 36.5%%
- 5Y: 26.1%
- Expense ratio: 0.25%
- Min SIP: ₹500
Also read: Mirae Asset Fund that Delivered 81.34% Returns in 1 Year; Can You Invest Now?
Top Silver ETFs to invest in
1. Tata Silver exchange traded fund
- NAV:27.45%
- AUM: ₹5,368 Cr
- 1Y: 176.19%
- Expense ratio: 0.39%
- Min SIP: ₹500
2. Nippon India Silver ETF
- NAV: 270.93
- AUM: ₹31,126 Cr
- 1Y: 175.51%
- 3Y: 52.13%
- Expense ratio: 0.56%
- Min SIP: ₹500
3. HDFC Silver ETF
- NAV: 270.48
- AUM: ₹7,649 Cr
- 1Y: 175.04%
- 3Y: 52.44%
- Expense ratio: 0.5%
- Min SIP: ₹500
Gold ETFs tend to be more popular in times of economic instability, as they are less volatile and provide a more stable investment. While silver ETFs can potentially deliver higher returns, they also carry increased volatility, especially given the increasing demand for industrial applications, such as solar panels, electronics, and EV batteries.
Conclusion
With the sharp import duty hike, investors are once again becoming interested in Gold and Silver ETFs which delivered impressive gains across its bullion linked funds. Gold ETFs are popular with investors who are seeking stability while silver ETFs are finding interest among those who believe in the growth potential of silver and its industrial uses.
ETFs provide investors with a cost-effective, transparent, and liquid way to gain exposure to precious metal prices without the hassles of owning physical bullion or coins. With this in mind and the recent volatility that has been seen, however, a diversified, long-term investment strategy might be a better option than short-term investing.
Written by Boyapati Sai Jasmitha
Disclaimer: The information provided in this article is for educational purposes only and should not be construed as financial advice or investment recommendation. Returns mentioned are based on historical performance and may not be sustained in the future. Mutual fund investments are subject to market risks, including potential loss of capital. Investors are advised to assess their risk appetite and financial goals and to consult a certified financial advisor before investing.
