Silver Investment Guide: Buying Silver In India

Silver is a popular investment option in India due to its affordability and decent returns. It is also a valuable industrial commodity with applications in solar panels, computers, and mobile phones. As one of the top 20 silver-producing countries globally, India has a significant influence on the international silver market.

When investing in silver, individuals can choose between physical silver, such as coins, bars, and jewellery, or paper forms, including silver futures and exchange-traded funds (ETFs). Physical silver is easily accessible from banks and local jewellers and can be stored at home or in bank lockers. However, investors should be cautious about the purity and pricing of physical silver and consider purchasing from reputed suppliers.

Paper forms of silver investment, such as ETFs, offer advantages like lower risks of theft and better liquidity. Additionally, digital platforms provide innovative ways to invest in silver, such as through the National Spot Exchange (NSEL), which allows investors to purchase silver in smaller denominations and hold it in Demat form.

Before investing, individuals should research the market, consult financial advisors, and be aware of the risks and potential returns associated with different investment options.

Silver coins for small investments

Silver coins are a great option for small investments. Silver is a popular investment choice in India due to its affordability and decent returns. Silver coins are easily available and can be purchased from banks and local jewelers. They can also be stored at home without much worry.

Silver coins are slightly more expensive than silver bars as the cost of labor for making the coins and imprinting images is added to the final price. However, they are a good option for salaried individuals and business people who want to save money regularly. You can accumulate a few coins every month and later sell them when you want to liquidate your investments.

When buying silver coins, it is advisable to choose reputed suppliers, such as banks or trusted jewelers, to ensure the purity of the silver. MMTC-PAMP, for example, is the world's most advanced precious metals processing facility, offering the highest purity silver coins in a wide range of designs, weights, shapes, and sizes. They provide safe payment options and assured delivery across India.

Silver coins also hold cultural significance in India, often used in prayer ceremonies and gifted during festivals and weddings.

Silver bars for huge investments

Silver bars are a great option for those looking to make huge investments in silver. Here are some reasons why:

Affordability

Silver bars are a more affordable option compared to other precious metals like gold. Silver is a good investment option due to its relatively lower price, making it accessible to those on a tighter budget.

Variety and Simplicity

Silver bars come in a variety of styles, including cast bars, hand-poured bars, and minted ingots. Additionally, multiple weight options are available, making the process of buying silver bars simple and quick.

Strong Investment

Silver bars are a strong investment option, especially if you have a significant amount of money to invest. They are also a good long-term investment choice due to their consistent demand in markets across the world, making it easy to sell them when needed.

Purity and Standardisation

Silver bars from reputable sources, like MMTC-PAMP, adhere to the global standard for purity, designated as 999.9 fine. This means you can be assured of the purity and authenticity of your investment.

Ease of Storage

Silver bars are easy to store and count. They are also stamped with important information like weight, purity, production date, and serial number, providing added security and protection for your investment.

If you're considering investing a large sum of money in silver, silver bars are a great option to explore. Remember to always buy from trusted suppliers and store your silver bars safely, preferably in bank lockers, to ensure the security of your investment.

Silver ETFs

When investing in silver through ETFs, you have the option to choose between ETFs that own physical silver and those that own futures contracts. The two main ETFs that own physical silver are the iShares Silver Trust (SLV) and the Aberdeen Standard Physical Silver Shares ETF (SIVR). These ETFs provide exposure to the physical silver market and aim to generate returns that are in line with the performance of physical silver prices, subject to tracking errors and expenses.

On the other hand, if you want to speculate on the silver market without owning physical silver, you can consider ETFs that own futures contracts, such as ProShares Ultra Silver (AGQ). However, this type of ETF is better suited for short-term bets rather than long-term holdings due to the structure of the fund.

It is important to note that silver ETFs, like any investment, come with certain risks. Silver prices can be volatile, especially over short periods, and are influenced by market forces and global financial markets. Additionally, as with any commodity investment, there is the risk of theft, illiquidity, and poor pricing when trading physical silver.

Silver mining stocks

• First Majestic Silver (NYSE:AG): A Canadian precious metals mining company that gets the majority of its revenue from silver mines in Mexico.
• Pan American Silver (NASDAQ:PAAS): A mining company with significant silver reserves and the world's largest silver reserves following its acquisition of Yamana Gold in 2023.
• Wheaton Precious Metals (NYSE:WPM): A precious metals streaming company that provides mining companies with cash to cover mine development costs in exchange for the right to buy some of the produced metal at fixed prices.
• Vedanta Resources Ltd: A global diversified natural resource company operating across segments such as zinc-lead-silver, oil and gas, and power.
• Hindustan Zinc Ltd: One of the world's largest lead-zinc miners, with significant revenue and operating income in 2024.
• Thanga Mayil Jewellery Ltd: A jewellery company involved in gold and silver and other precious metals.
• Goldiam International Ltd: A jewellery company with increasing market demand, particularly in major Indian cities.

It is important to carefully research and analyse silver mining stocks before investing, considering factors such as stock price performance, mining operations, dividend yield, financial health, and global demand for silver.

Digital silver

To start investing in digital silver, prospective clients need to open depositary accounts with these members. The National Spot Exchange also offers the option to invest in physical silver.

One platform that offers digital silver investment is DigiGold, a brand by Amrapali Gujarat, which is among the top 5 Bullion Dealers in India. DigiGold has been tested for all parameters of Cyber Security as per Government norms. It offers free storage for up to one year and the silver is stored with Brink's, a global market leader in secure logistics and vault services.

Frequently asked questions