What Rising Gold and Silver Prices Mean for Your Portfolio in 2025–26

Rising gold and silver prices are prompting many Indian investors to reassess portfolio balance rather than chase fresh highs. For most retail investors, precious metals continue to work best as a 10–15% stabilising allocation, acting as a hedge during volatility rather than a core growth engine. Financial instruments such as gold ETFs and Sovereign Gold Bonds (SGBs) remain the preferred routes, while jewellery and coins are increasingly viewed as consumption rather than investment.

Why gold and silver are surging

• Gold and silver delivered outsized returns in 2025. Gold-linked funds rose roughly 55–65%, while silver gains ranged widely—from 30% to over 100% depending on the product and market. The rally has been driven by geopolitical uncertainty, sustained central-bank buying, a weaker rupee, and expectations of global interest-rate cuts.
• Looking into 2026, gold is widely positioned as a defensive anchor, while silver is seen as a higher-volatility play due to its strong linkage to industrial demand, including solar, electronics, and green infrastructure. This distinction matters for investors deciding how much exposure to take—and where.

How much gold and silver should you hold?

Many advisors now suggest a combined 10–15% allocation to precious metals for a diversified Indian portfolio, with gold forming the bulk and silver playing a smaller, higher-risk role.

• A common split for salaried investors in their 20s and 30s looks like:
  • 5–10% in gold as a long‑term hedge and crisis reserve.
  • 0–5% in silver if you are comfortable with higher volatility and can ride 20–30% swings.

Investors with unstable income or significant existing jewellery holdings may prefer staying toward the lower end of this range and directing fresh allocations toward financial gold rather than physical assets.

Best ways to buy: ETFs, SGBs, digital gold, coins

Gold ETFs: Traded on the exchange, track domestic gold prices, require a demat account, and allow SIP‑style staggered buying.​ Pricing is transparent, and products are SEBI-regulated.

Sovereign Gold Bonds (SGBs): Issued by RBI, offer gold‑linked returns plus around 2.5% annual interest; capital gains are tax‑free if held to maturity (8 years).​ Best suited for investors who can lock money in for the long term and want maximum tax efficiency instead of liquidity.

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Digital gold (UPI apps): Available via apps like PhonePe, Paytm, Google Pay from as little as ₹1, with the provider storing vaulted gold on your behalf.​​ However, it comes with GST, wider spreads, and regulatory caveats, as digital gold itself is not classified as a regulated security or commodity.

Physical coins and bars: Work best when you specifically need physical gold for weddings or emotional reasons. Higher friction costs: GST, making charges, and buyback deductions, which mean they typically form only a small portion of an investment-oriented portfolio.​​

Silver exposure for most retail investors is still easiest via silver ETFs or fund‑of‑funds rather than physical bars, given high storage, purity, and resale challenges.​

What this means for your 2025–26 portfolio

• With gold at record highs (₹1.17–1.38 lakh per 10g) and silver above ₹1.4–2.1 lakh/kg, experts advise rebalancing rather than aggressive fresh buying. Profit-booking on excess allocations, followed by staggered purchases on dips, is often preferred over lump-sum entries at all-time highs.
• A pragmatic allocation for a typical Indian growth‑oriented investor in 2025–26 might look like:
  • 60–70% in equities or equity mutual funds.
  • 15–25% in debt or fixed income instruments.
  • 10–15% in gold and silver combined, tilted strongly to gold through ETFs and SGBs, with any jewellery treated as consumption, not part of the “investment” bucket.​

If your metals allocation is already above this range due to family gold or recent buying, the next step is to freeze further jewelry purchases, shift new gold buying to ETFs/SGBs, and focus fresh savings on equities and debt until the balance is restored. 

Rising metal prices are a reminder that gold and silver play an important role—but rarely the starring one. 

For most investors, the smarter move in 2025–26 is rebalance, not chase. Where does gold or silver sit in your portfolio right now?

For questions, collaborations, or deeper guidance, write to us at info@nomisma.club.

Disclaimer: This article is for educational purposes and not financial advice.