Market experts are advocating for continued investment in gold and silver despite recent record highs, emphasizing the long-term structural factors supporting precious metals. Bandhan AMC has launched new investment vehicles targeting these metals, with fund subscriptions opening from January 12 to January 20.

New Fund Launches Target Precious Metals Theme

Bandhan AMC has introduced both a Gold ETF Fund of Fund and a Silver ETF Fund of Fund, with the subscription period running through January 20. Gaurab Parija, Chief Business Officer at Bandhan AMC, emphasized that fund launches are driven by theme sustainability rather than short-term price movements.

"We always believe that fund launches are not basis the timing of the underlying pricing, but more importantly, on the sustenance of the theme. We believe that this theme is going to be lasting for a long period of time, and hence the timing is more incidental," Parija stated.

Structural Factors Support Gold's Long-Term Outlook

Sachin Jain, CEO of the World Gold Council, identified multiple global factors supporting gold's performance over the past 18 months. The combination of rising global debt levels, particularly in the US, ongoing geopolitical tensions, and trade-related uncertainties has created a favorable environment for gold investment.

Parija noted a structural shift in gold's perception, with the metal increasingly viewed as a store of value as central banks worldwide continue adding to their reserves. This represents an evolution beyond gold's traditional role as merely an inflation hedge or geopolitical risk protection.

Silver Benefits from Dual Demand Drivers

Silver presents a unique investment proposition with demand stemming from both precious metal and industrial applications. Parija highlighted that approximately 60% of silver consumption now originates from industrial sectors including electric vehicles, electronics, and renewable energy.

The supply side remains constrained, creating what experts describe as structural rather than cyclical deficits. However, investors should anticipate higher volatility in silver compared to gold.

Portfolio Allocation Recommendations

Both experts advocate for strategic portfolio diversification through precious metals allocation. They recommend gold allocation of approximately 10-15% of a portfolio, built gradually through instruments like ETFs to improve overall portfolio stability.

Key investment considerations include:

• Long-term perspective: Focus on portfolio allocation rather than tactical trading
• Gradual accumulation: Build positions systematically through ETF instruments
• Volatility awareness: Prepare for higher silver volatility compared to gold
• Diversification benefits: Enhance portfolio stability in uncertain global environment

While short-term corrections cannot be ruled out following the recent sharp rally, experts emphasize viewing these metals as long-term portfolio components rather than short-term trading opportunities. The World Gold Council, while not providing price forecasts, believes the current environment continues supporting gold over the medium to long term.

Silver prices in India extended their rally to hit a fresh record high on Tuesday, with the Multi Commodity Exchange of India (MCX) witnessing unprecedented levels amid global market volatility. The surge comes as international silver prices also reached new peaks, supported by geopolitical tensions and robust industrial demand.

Record-Breaking Performance on MCX

Silver prices on MCX demonstrated exceptional strength during Tuesday's trading session. The following table highlights the key price movements:

The white metal jumped more than 6% in the previous session, reflecting strong momentum in the precious metals sector. This performance comes alongside spot silver hitting an all-time high of $86.22 internationally.

Market Drivers and Geopolitical Factors

The rally in silver prices has been fueled by multiple factors creating a supportive environment for precious metals. Escalating global geopolitical tensions have increased safe-haven demand, while the Trump administration's opening of a criminal investigation into Federal Reserve Chair Jerome Powell has added to market uncertainty.

Further contributing to geopolitical worries, US President Donald Trump announced that any country conducting business with Iran will face a 25% tariff on trade with the United States. Non-yielding assets like silver tend to perform well in low-interest-rate environments and during periods of heightened geopolitical or economic risks.

Industrial Demand and Supply Dynamics

According to Ponmudi R, CEO of Enrich Money, silver continues to trade with a strong structural bias, supported by persistent supply deficits and accelerating demand from industrial applications. The expert highlighted several key demand drivers:

• Solar energy applications
• Electric vehicle manufacturing
• AI infrastructure development
• Electronics sector requirements
• Sustained safe-haven investment flows

Citi has raised its three-month price targets to $100 per ounce for silver, citing strong investment momentum and multiple bullish drivers expected to remain intact during the first quarter. The bank noted that ongoing physical market shortages on silver could worsen in the short term due to potential delays in Section 232 tariff decisions.

Technical Analysis and Price Outlook

Comex silver price is holding firm near $85 after marking a fresh lifetime high, trading comfortably above its short- and medium-term moving averages following a decisive breakout from consolidation. Technical experts suggest that while the $85 zone may invite intermittent profit-taking, a clear breakout above $86-$88 could trigger the next impulsive move toward $90-$95, with strong support seen in the $80-$83 zone.

For MCX silver, sustained strength above ₹2,70,000 keeps upside momentum intact, with a breakout beyond ₹2,72,000 potentially propelling prices toward ₹2,85,000-₹3,00,000 levels. Any corrective move below ₹2,60,000 may test the ₹2,55,000-₹2,45,000 support zone, where fresh buying interest is expected to emerge.