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Silver ETFs have surged to fresh record highs, mirroring the sharp rally seen in silver prices globally. This strong uptrend has left many investors wondering whether it is still wise to enter silver ETFs at current elevated levels or whether it would be better to wait for a correction. Market experts believe that while risks have increased, disciplined strategies can still help investors navigate the rally.

Silver Prices at All-Time Highs

The rally in silver has been extraordinary. Silver futures contracts across multiple expiries have climbed sharply, reflecting heightened demand for safe-haven assets. The March expiry silver futures jumped nearly 3% to hit a record high of ₹3,18,729 per kilogram. Futures expiring in May and July also crossed historic levels, touching ₹3,28,854 and ₹3,35,885 per kilogram respectively.

In the global market, spot silver surged to a record high of $94.72 per ounce, reinforcing the bullish sentiment. This rapid rise has directly boosted silver exchange-traded funds (ETFs), which track the price of the metal.

Why Is Silver Shining So Bright?

According to analysts, rising geopolitical tensions are a key driver behind silver’s sharp move. Recent developments involving Greenland have escalated tensions between the US and Europe. US President Donald Trump announced fresh tariffs on imports from several European countries, adding uncertainty to global trade dynamics.

The US has imposed a 10% tariff effective from February 1, which is set to rise to 25% from June 1 unless negotiations over Greenland reach a resolution. Trump has also not ruled out the possible use of military force, a statement that has further rattled global markets. European leaders have rejected these demands, with some countries warning of retaliatory measures.

Speaking to Reuters, Tim Waterer, Chief Market Analyst at KCM Trade, noted that tariff-related uncertainty and expectations of lower interest rates are proving supportive for precious metals like gold and silver. This environment has significantly strengthened investor demand for silver.

How Are Silver ETFs Performing?

The rally in silver has pushed Indian silver ETFs to record levels. Groww Silver ETF jumped more than 7% to reach a one-year high of ₹308.37. Other major funds, including Tata Silver ETF, Motilal Oswal Silver ETF, Aditya Birla Silver ETF, Edelweiss Silver ETF, and Mirae Silver ETF, gained around 5%, touching their respective record highs.

ETFs from UTI, DSP, Axis, HDFC, Zerodha, and Kotak rose over 4%, while ICICI Prudential Silver ETF, Nippon Silver ETF (SilverBeES), and SBI Silver ETF also posted gains of nearly 4%. The broad-based rally highlights strong investor participation across the silver ETF segment.

Should You Invest in Silver ETFs at Current Levels?

Experts advise caution for fresh investors. Ross Maxwell, Global Strategy Operations Lead at VT Markets, believes that valuation risk and market sentiment are the biggest concerns at present. He points out that silver is far more volatile than gold, meaning that sharp gains can quickly reverse if trader interest weakens.

Maxwell warns that investors entering at current levels may face short-term losses if prices correct. However, he suggests that investors who still wish to gain exposure should adopt a dollar-cost averaging strategy. This approach involves investing smaller amounts at regular intervals, which helps average out the purchase price and reduces the risk of timing the market poorly.

For existing investors, experts recommend partial profit booking, especially for those who entered silver ETFs with a short-term investment horizon. Locking in some gains can help protect returns while maintaining limited exposure for further upside.

Bottom Line

Silver ETFs are riding a powerful momentum, supported by global uncertainty and strong safe-haven demand. While the long-term outlook for silver remains positive, the current record-high levels demand a cautious and disciplined approach. New investors should avoid lump-sum investments and consider staggered entries, while existing investors may benefit from booking partial profits.

As always, investors are advised to assess their risk appetite and consult certified financial advisors before making any investment decisions.