Is the white metal ready for a catch-up rally?
Sheth said moves in silver are usually swift and shorter compared with gold. "We would suggest traders buy it at current levels, to take advantage of the rally."
The gold to silver ratio - measured by dividing gold prices by silver - is at 100, the highest since Covid in 2020. It is also trading above its average levels for the current century of around 85 levels, according to data from Samco Securities. The gauge, which compares the prices of gold and silver, signals that silver offers better value now.
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Mumbai: Is silver on the cusp of a catch-up rally with gold? A ratio measuring the price of silver versus gold indicates the white metal might be poised for a run-up as its recent underperformance is perceived as excessive.The gold to silver ratio - measured by dividing gold prices by silver - is at 100, the highest since Covid in 2020. It is also trading above its average levels for the current century of around 85 levels, according to data from Samco Securities. The gauge, which compares the prices of gold and silver, signals that silver offers better value now."We find ourselves at an interesting threshold for silver because the gold-silver ratio has surpassed 100, which marks a significant event that has only occurred three times in the past 50 years (in 1991, 2020, and now)," said Ramesh Varakhedkar, head - commodities at ICICI Securities. "Historically, this ratio being above 100 has often led to a strong recovery in silver prices as it (silver) tends to play catch-up with gold, which has rallied more swiftly in recent times."The ratio had made an all-time high of 126.5 in March 2020, from where silver prices had doubled by the month of August. Investors looking to bet on silver could consider buying its exchange traded funds (ETFs).Gold was trading at $3,300 per ounce and silver was at $32.99 per ounce as of 7 PM on Monday.International gold prices surged over 25% in 2025, according to data from investing.com, fuelled by growing demand for safe-haven assets in the wake of Donald Trump tariff actions. Silver has gained only 14.5% this year."Should geopolitical tensions continue to escalate, gold may maintain its upward trajectory, potentially reaching the $3,600-3,700 range," said Navneet Damani, head of research - commodities & currency at Motilal Oswal Financial Services "Conversely, if geopolitical risks subside - particularly if President Trump resolves with China - market sentiment could shift, leading to a correction in gold and a relative outperformance in silver." Damani remains bullish on silver because the metal's supply is in deficit for its fifth consecutive year."For investors who missed the recent rally in gold, silver presents an attractive opportunity," he said.Apurva Sheth, head of research at Samco Securities, said the ratio indicates that silver is currently undervalued compared to gold, and should see some catch up in the coming months.Damani recommends investors buy silver and bet against gold, with the expectation that the gold-to-silver ratio could decline by approximately 10%, targeting the 90 level. His target for silver is $35-36, or ₹1,02,000-1,10,000 per kilogram.Varakhedkar expects silver to cross the $35 mark and potentially reach $40 by the end of the year, translating to around ₹1,10,000 per kg of silver in local currency."For investors, this presents a prime opportunity to diversify their portfolios. Incorporating silver alongside gold not only balances exposure to precious metals but also positions investors to take advantage of silver's anticipated price movement," he said.Sheth said moves in silver are usually swift and shorter compared with gold. "We would suggest traders buy it at current levels, to take advantage of the rally."
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