InCred Wealth, May 26 2025
Gold vs. Silver in 2025
2025 is turning out to be quite a challenging year for most investors and fund managers. Economic downturn, interest rate hikes, geopolitical tensions, conflicts, uncertainty surrounding the economic recovery and volatile market conditions are at play.
As the outlook of financial markets for 2025 become tenuous,precious metals, more often than not, are popping up in conversations with wealth managers as a hedge against volatility, and as a long term store of wealth..
Gold: The Enduring Safe Haven
Gold prices increased 20.8% in 2024, ending at ₹79,700 per 10 grams, the highest gold price in history. Market analysts believe gold prices will spike again in 2025 by approximately 15-18%.(mint).
Several macro factors are contributing to this bullish outlook:
• Central Bank Accumulation: Sustained purchases, especially from emerging markets, are propping up demand.
• Geopolitical Risks: Continued instability in global affairs is prompting investors to turn to gold’s time-tested safety.
• Currency Shifts: With the dollar expected to weaken, gold’s appeal as a store of value is growing.
Silver: The Dual-Purpose Metal
Silver, meanwhile, is emerging as a tactical play in 2025. Its value proposition is two-fold acting both as a precious metal and an industrial asset. Demand is accelerating due to silver’s crucial role in fast-growing sectors like electric vehicles, solar energy, and electronics.
Coupled with a projected supply deficit of 149 million ounces, silver's price outlook is optimistic.
• Industrial Utility: As a key input in green technologies and electronics, silver is benefiting from structural demand shifts.
• Supply Constraints: Limited new mining capacity and rising industrial use are tightening availability.
• Attractive Entry Point: Silver’s lower price per ounce and higher return potential make it a compelling diversifier.
Blending Stability with Growth
In portfolios tailored for HNIs, gold offers stability in an era of global uncertainty, while silver acts as a growth lever tied to industrial innovation. Together, they serve as complementary assets.
Gold tempers portfolio risk, while silver introduces a dynamic element—potentially boosting returns in a reflationary or tech-driven cycle.
Strategic diversification matters now more than ever
High Networth individuals may want to adopt a balanced approach in 2025, revisiting or incorporating gold and silver in their asset allocation strategy. While gold offers time-tested security and stability, silver represents a high-conviction opportunity aligned with long-term megatrends.
As market cycles shorten, and economic headwinds become a more common phenomenon, hands-free approaches are becoming outdated and repositioning is beginning to get more attention. Today's wealth managers are not simply suggesting gold or silver as the only two options, they are creating plans that are sophisticated to the needs of the investor and consider the liquidity and time frame. In 2025, the true resilience of the portfolio will be determined by this careful strategic diversification using historical stores of value along with future-facing growth vehicles.
To understand how precious metals can fit into your broader investment strategy, connect with our wealth team for a personalised portfolio review at contactus@incredwealth.com
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