Gold and silver prices have been moving sharply up and down. For many small investors, that raises a simple question. If prices are so volatile, how can they still be considered safe?
The answer lies in what gold and silver are meant to do in a portfolio.
When stock markets fall sharply or global tensions rise, investors look for assets that can hold their value. Gold and silver are called “safe haven” assets because they tend to perform better during uncertain times.
They are not linked to company earnings or corporate performance like shares. They are physical assets with global demand. That makes them useful as protection when riskier investments wobble.
Right now, uncertainty remains high. Global equity markets are volatile and geopolitical tensions, including the US-Iran situation, are adding pressure. In such an environment, many investors prefer to keep some portion of their money in bullion.
The latest physical prices in India show that gold and silver have corrected from recent highs but remain elevated. Twenty-four-carat gold is trading near Rs 15,400 per gram, while twenty-two-carat gold is around Rs 14,130 per gram. Silver is close to Rs 2,54,900 per kilogram in major cities.
Ponmudi R, CEO of Enrich Money, says investors should not confuse short-term corrections with long-term weakness.
“Gold has corrected from recent highs above 5,500 dollars, but strong support in the 4,500 to 4,700 dollar zone shows underlying demand,” he says. In simple terms, this means buyers are stepping in at lower levels, preventing prices from collapsing further.
On MCX, which is India’s commodity exchange where futures contracts are traded, gold prices have fallen from record highs near Rs 1,80,000 but are finding buying interest between Rs 1,45,000 and Rs 1,50,000. A futures contract is simply an agreement to buy or sell gold at a future date at a fixed price. Many traders use these contracts to hedge risk.
“The broader uptrend structure remains intact,” Ponmudi says. If gold sustains above support and crosses Rs 1,60,800, momentum could return.
Silver has seen even sharper swings. On MCX, silver corrected from around Rs 4,20,000 and is now trading near Rs 2,30,000 to Rs 2,50,000. Buying interest is visible between Rs 2,25,000 and Rs 2,35,000. This suggests that investors are using price dips to accumulate gradually.
So why are gold and silver still considered a safe bet?
Because safety does not mean prices never fall. It means that over time, these assets tend to preserve value when inflation rises, currencies weaken, or markets turn unstable.
They act like insurance for your portfolio. Just as you pay for insurance hoping you never need it, holding some gold or silver can cushion losses when other investments struggle.
For small investors, the idea is not to put all money into bullion. It is to keep a reasonable portion as protection. Volatility may continue, but as long as global risks remain elevated and key support levels hold, gold and silver continue to serve their primary purpose: stability in uncertain times.
(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)
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