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Akshaya Tritiya, an occasion considered auspicious for buying precious metals, witnessed significantly stronger interest in gold and silver exchange-traded funds (ETFs) this year with the combined industry traded volume spiking 2.9 times to Rs 644 crore, up from Rs 224 crore last year.

Notably, volumes of silver and gold ETFs during this year’s Akshaya Tritiya were the highest ever.

Nippon India Mutual Fund, which has the biggest precious metals ETFs, in terms of assets, saw the highest traded volume during this year’s Akshaya Tritiya (on April 30, 2025) at Rs 404 crore, which is around 63 percent of the total industry volume of gold and silver ETFs.

At the industry level, gold ETFs saw a traded volume worth Rs 331 crore on Akshaya Tritiya, out of which Nippon India ETF Gold BeES stood at Rs 172 crore, or about 52 percent of the total industry volume of gold ETFs.

Silver ETFs recorded a total volume of Rs 313 crore this year, of which Nippon India ETF Silver BeES accounted for Rs 232.5 crore, representing 74 percent of the industry's total silver ETF volume.

A similar trend was observed during Dhanteras last year when Nippon India Mutual Fund's combined volume (Rs 228 crore) was the highest at 53.3 percent of the total industry volume of gold and silver ETFs.

ETFs offer a convenient means to invest into these precious commodities, allowing investors easily to invest and withdraw anytime without the hassle of having to store them physically and not worry about aspects like purity, safety and storage costs.

Silver shines

Nippon India Silver ETF is the biggest silver fund in India with assets under management of Rs 6,132 crore as of April end. On the other hand, Nippon India ETF Gold BeES is the biggest gold fund with an AUM of Rs 19,782 crore.

"Gold is generally perceived as a safe haven asset, with heightened interest, particularly during times of uncertainty. With recent uncertainties around geopolitics around the world, policy and tariff related uncertainties, the appeal of gold has increased. Consequently, investors have preferred to allocate more towards gold," said Arun Sundaresan, Head ETF, Nippon Life India Asset Management Ltd.

Silver, on the other hand, is a risk asset, behaving more like equities, and displaying a higher risk-return profile when compared to gold. Silver finds a lot of usage in high-end manufacturing and in general, has a higher correlation with economic growth.

"Higher investments in both gold and silver in the recent past could be a result of investors’ desire to diversify, given the higher volatility that could be expected from other asset classes such as equity in the current uncertain environment," said Sundaresan.

Surge in volume of silver ETFs 

Traded volume of silver ETFs jumped to Rs 313 crore this Akshaya Tritiya, which is more than three times of traded volume of last year at Rs 95 crore.

In the recent past, the last one year, gold return has been higher than silver. One-year return of gold is close to 29 percent, whereas the same for silver is around 16 percent.

“This has resulted in the Gold-Silver ratio, a typical reference used by investors, to be close to 1. Historically, the gold-silver ratio tends to hover around 0.7, indicating that gold has run up sharply compared to silver. Investors may be perceiving silver valuations to be relatively more attractive than gold basis on the recent price movement, which may explain the higher flows in silver,” said Sundaresan.

Rise in passive investing

Investing through ETFs is an efficient manner to take exposure to capital markets and in the case of gold and silver ETFs, to commodities.

ETFs allow investments to be made during the trading day at a relatively low cost, unlike other mutual funds where investments could be made only basis the end of the day value of the funds.

Passive funds, including ETFs, tend to be fully invested at all points in time, and being rules-based, invest exactly as per the index methodology, effectively becoming true-to-label funds.

“Investors get what they signed up for, now and through the life of the fund, without any style drift or dilution of the portfolio beyond the mandate. Passive Funds also offer a range of product strategies to choose from several sub-categories of equity, fixed income, & gold and silver,” said Sundaresan.

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