Several large mutual fund institutions have filed draught paperwork for new silver ETFs, including HDFC Mutual Fund, DSP Mutual Fund, ABSL Mutual Fund, and Nippon India MF.
The ICICI Prudential Mutual Fund has launched a silver ETF that will be available for purchase till January 19.
SEBI approved operating criteria for the establishment of silver ETFs in November. These ETFs must invest at least 95 per cent of their net assets in silver and silver-related products, according to the rules. Until today, gold was the only precious metal available in the form of an ETF for investors.
Silver ETFs, according to mutual fund firms, can be an excellent method to diversify your portfolio and hedge it against non-related asset classes.
Silver ETFs, we believe, will be one of the most popular options for investors to gain exposure to silver because they do not have to worry about the bulky nature of silver, its purity, quality, or liquidity. When it comes to precious metals investing, silver is one of the most popular choices around the world.
Several mutual fund experts and financial planners, on the other hand, believe that investors should think twice before buying silver ETFs.
This is a fantastic way to hedge your portfolio, but there are a few things to keep in mind. Gold is utilized as a hedge, and many people store it up to purchase gold in the future. Investors should look into silver ETFs in the same way. As a result, in my opinion, investors should have realistic expectations.
Silver isn’t going to provide you with astronomical returns “FinSherpa Investment, a financial advising organization based in Chennai, says Babu Krishnamoorthy, Chief Sherpa.
Because ETFs effectively mimic the index, there isn’t much of a difference in performance. As a result, you can pick anyone from a reputable fund house. Commodity funds or schemes used only for hedging your portfolio should account for 5-10% of your total investment.
Investors should be careful not to overextend themselves with these funds. You don’t need silver if you already have gold as a hedge in your portfolio. If you wish to invest in gold, don’t put more than 5% of your income into it “Recent,” suggests.
New investors should be aware that silver ETFs are not the same as traditional mutual funds. You must have both broking and a Demat account. Unlike conventional gold funds, you must sell these ETFs in exchange to get your money back.
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