Gold, silver ETFs surge up to 8% to fresh record highs as precious metals extend bull run: What lies ahead?

Gold and Silver

• Gold and silver ETFs hit lifetime highs amid global tensions and trade war fears
• Analysts foresee long-term gains but warn of short-term import duty risks.
• Experts suggest investing up to 10% of portfolio in precious metals for diversification.

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Gold and silver exchange traded funds (ETFs) continued to mirror the sharp surge in the precious metals, and hit fresh lifetime highs on January 21. Market analysts have commented on what lies ahead for the precious metal after the record bull run, and what investors should do now.

Gold and silver prices hit fresh lifetime highs today, as tensions between US and EU heightened over President Donald Trump’s constant threats to annex Greenland and tariff flipflops.

Gold ETFs:

Gold futures with February expiry jumped more than 5 percent to cross the Rs 1.58 lakh per 10 grams mark. The futures contracts with April and June expiries meanwhile gained 5 percent and 6 percent respectively to hit fresh all-time highs of Rs 1,66,048 per 10 grams and Rs 1,71,620 per 10 grams, respectively.

Invesco India Gold ETF surged nearly 8 percent to hit a fresh 52-week high of Rs 13,900 apiece. ICICI Pru Gold ETF, LIC Gold ETF, Motilal Oswal Gold ETF, Edelweiss Gold ETF and Axis Gold ETF meanwhile gained more than 7 percent each.

BNP Paribas Gold ETF, Groww Gold ETF, Tata Gold ETF, Quantun Gold ETF and Kotak Gold ETF gained nearly 7 percent each, while Angel One Gold ETF, Zerodha Gold ETF, Aditya Birla Gold ETF and DSP Gold ETF gained more than 6 percent each.

Union Gold ETF, HDFC Gold ETF, SBI Gold ETF, Nippon Gold ETF (Goldbees) and Mirae Asset Gold ETF jumped more than 5 percent each, while Choice Gold ETF, UTI Gold ETF and others gained nearly 5 percent.

Silver ETF:

Silver futures with March expiry jumped around 3.5 percent to cross the Rs 3.3 lakh per kilogram-mark for the first time ever. The futures with May and July expiries meanwhile rose 4 percent and 5 percent to Rs 3.47 lakh per kilogram and Rs 3.61 lakh per kilogram.

Tata Silver ETF gained around 7 percent to hit a fresh 52-week high of Rs 33.50 apiece. Aditya Birla Silver ETF and Mirae Asset Silver ETF gained around 5 percent each.

Axis Silver ETF and Nippon Silver ETF (Silverbees) climbed nearly 4 percent each, while Zerodha Silver ETF, ICICI Pru Silver ETF, DSP Silver ETF, Edelweiss Silver ETF and UTI Silver ETF gained more than 3 percent each.

There is risk-off sentiment in global markets now in response to Trump’s Greenland policy, the threatened tariffs on eight European countries and Europe’s hardening anti-Trump stance, said VK Vijayakumar, Chief Investment Strategist, Geojit Investments.

The analyst added that globally stock markets are down and the flight to the safety of gold is up. “There is no clarity on how the situation will evolve. If the threatened tariffs come into effect, Europe will retaliate and this will lead to a trade war with bad consequences for global trade and global growth. If such a scenario plays out stock markets will witness further selling. On the other hand, if Trump chickens out as he had done in the past, or succumbs to pressure, markets will rebound. A combined and united Europe has many options like the much talked about ‘Sell America’ wherein they sell US treasuries leading to sharp fall in dollar. This will hurt Trump. Public opinion in US is also against Trump’s Greenland annexation plan. Many unexpected developments can happen and the market is likely to react strongly to the developments,” he said.

"Trump's 'disruptive' policy approach to international affairs and desire to see lower interest rates suit precious metals very well, ⁠as reflected by gold and silver's rampant run," Reuters quoted Tim Waterer, KCM Trade's chief ‍market analyst, as saying.

What lies ahead?

Based on the fundamentals and technical setup, gold and silver's long-term bullish trend seems intact and still has the potential to deliver extraordinary returns in year 2026, said HDFC Securities. The domestic brokerage however added that in case the government reduces import duties on gold and silver in the upcoming budget, domestic prices could come under pressure and act as a short-term headwind for domestic prices.

HDFC Securities listed out SBI Gold ETF and HDFC Gold ETF as its top picks, and advised investors to allocate 10 percent of their portfolio to precious metals with the option to increase exposure based on individual risk appetite gradually.

"Gold and silver can play a meaningful role in portfolio diversification, but the way investors access these assets matters. Physical metal often brings uncertainties around purity, making charges, storage, and resale, while ETFs require demat accounts that many investors still do not use. The Fund of Fund (FoF) structure removes barriers such as demat requirements, lowers the entry point to ₹1,000, and enables disciplined investing through SIPs starting at ₹100," said Vishal Kapoor, CEO of Bandhan AMC.

"Gold and silver have climbed to record highs as global tensions continue to mount. Markets have been unsettled by Donald Trump’s renewed push to acquire Greenland, alongside U.S. plans to impose tariffs of 10% from February 1 on eight European countries including France, Germany, and the UK, with the threat of rates rising to 25% by June," said NS Ramaswamy, Head of Commodity & CRM, Ventura.

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