Expert View: Silver Shines Brighter, but Gold ETFs Still Dominate Investor Flows, says Rajkumar Subramanian
- 7th September 2025
- 02:30 PM
- 3 min read
Summary
Silver ETFs in India have outperformed gold in 2025, but investor flows remain concentrated in Gold ETFs, says Rajkumar Subramanian of PL Capital. Despite a bullish long-term outlook for silver driven by demand-supply imbalances, investors still prefer the familiarity and liquidity of gold ETFs. Analysts expect gold and silver to benefit from central bank buying and interest rate dynamics, but silver’s volatility keeps investors cautious.Mumbai | September 18
Gold ETFs Continue to Outshine in Investor Flows
Gold remains the most trusted asset class for Indian investors, particularly through exchange-traded funds (ETFs). According to Rajkumar Subramanian, while silver has delivered stronger returns this year, the bulk of investor flows continue to be directed towards Gold ETFs in India.
“People are still not as comfortable with silver as an ETF commodity. The familiarity and media spotlight around gold ETFs naturally draw most of the flows. Gold has established itself as the most widely tracked ETF commodity, whereas silver still lacks the same visibility,” he said.
This preference highlights a long-standing behavioural trend in India. Gold enjoys cultural, financial, and institutional dominance, while silver ETFs—though available and outperforming in 2025—have yet to capture investor mindshare at scale.
Silver ETFs: Higher Risk, Higher Reward
Silver has been the star performer in 2025, outpacing gold and other commodities. Analysts remain bullish on silver, pointing to a persistent demand-supply imbalance. Over the last few years, global silver demand has consistently exceeded supply, strengthening the case for ETF investment in silver.
“Silver is well-positioned to deliver strong returns over the next three to four years,” Subramanian observed, while cautioning investors about volatility.
Unlike gold, silver tends to swing more sharply in response to global economic shifts. For aggressive investors who can tolerate higher risks, Silver ETFs in India may provide stronger long-term returns. However, conservative investors remain inclined towards the stability of gold.
Precious Metals Outlook: Central Banks and Rate Cuts in Focus
Beyond ETF-specific flows, the precious metals outlook in 2025 is shaped by central bank buying and global monetary policy.
Subramanian noted that central banks remain net buyers of gold, reinforcing the long-term support for the metal. Meanwhile, the US monetary and fiscal backdrop, particularly around interest rate cuts, is expected to influence flows into both gold and silver ETFs.
“While rate cuts may have a short-term impact, the longer-term implications are far more supportive of real assets. This includes gold, silver, and other commodities,” he said.
Interestingly, flows into Gold ETFs are not expected to dent equity allocations. “We don’t see ETF flows into gold impacting equity inflows in any way,” Subramanian added.
What It Means for Investors
The message for investors is clear: Gold ETFs remain the dominant choice for those seeking safety, liquidity, and long-term trust. Silver ETFs, on the other hand, offer higher growth potential but come with elevated volatility.
With India’s rising appetite for ETFs and global trends supporting commodities, both gold and silver are set to play a critical role in ETF investment strategies for 2025. However, investors must align their allocations with risk appetite—stability seekers may prefer gold, while aggressive investors may consider silver for higher returns.
