Gold, silver prices rise again: Should investors stay invested in ETFs or book profits?

Gold and silver prices moved higher on Wednesday as a weaker US dollar and ongoing geopolitical uncertainty supported sentiment in precious metals. The rise comes at a time when investors are facing a familiar dilemma: continue holding Gold and Silver ETFs for potential long-term gains or use the recent rally to lock in profits.

On the Multi Commodity Exchange (MCX), silver futures for July 2026 delivery climbed ₹2,000, or 0.7%, to ₹2,72,628 per kg, while gold futures for June delivery rose ₹215 to ₹1,57,898 per 10 grams. The gains were driven by dollar weakness and cautious positioning ahead of key US inflation data and Federal Reserve commentary.

However, the price recovery comes against a backdrop of shifting investor behavior in exchange-traded funds (ETFs). Global investors have recently pulled money out of physically backed gold ETFs despite the broader bullish narrative for precious metals.

Gold ETFs of late

According to World Gold Council (WGC) data, physically backed gold ETFs witnessed total inflows of $1.09 billion last week, but outflows exceeded that at $2.17 billion. The United States and China led withdrawals at $635 million and $623 million, respectively.

Investor exits accelerated after gold prices slipped below $4,600 an ounce. Gold has also corrected sharply from its January peak of $5,608 an ounce and remains nearly 19% below that record level.

Still, market experts believe investors should focus less on short-term movements and more on portfolio objectives.

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Gold vs Silver ETFs

Harshal Dasani, Business Head at INVasset PMS, said Gold ETFs remain a more stable allocation among precious metals because they act as macroeconomic insurance and portfolio protection. Gold benefits from central-bank buying, currency uncertainty, inflation risks and periods when confidence in financial assets weakens.

He noted that gold does not require an industrial demand cycle to perform and therefore works better as a portfolio hedge. While the rally has already been substantial, Dasani believes investors should remain disciplined rather than chase prices aggressively.

For Indian investors, another factor strengthens the gold story: the currency effect.

Dasani noted that the rupee trading near record lows against the US dollar provides an additional boost to domestic gold prices even when international prices pause. Higher import duties have also raised landed costs, supporting local bullion-linked investments.

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Silver, however, presents a different investment proposition.

Unlike gold, silver combines safe-haven appeal with industrial demand from sectors such as solar energy, electronics, electric vehicles and electrification projects. This dual demand profile can make silver a more aggressive play during a precious-metals rally.

Dasani described Silver ETFs as a "higher-beta" version of the precious-metals trade because they tend to move more sharply when liquidity improves and investor risk appetite rises.

The downside, however, is volatility. Silver can witness steeper corrections if global growth weakens or industrial demand slows. Yet experts believe the medium-term outlook remains constructive because industrial and monetary demand drivers continue to support the metal.

So should investors book profits?

Market experts suggest that profit-booking may make sense for investors who had taken tactical positions and have already earned significant gains. However, for long-term investors using Gold ETFs as a hedge against inflation, geopolitical risks and currency depreciation, staying invested could remain the preferred strategy.

The choice becomes more nuanced for silver investors. Conservative investors may prefer gold for stability, while those with a higher risk appetite and longer investment horizon may continue holding Silver ETFs for potentially larger upside.

For now, the precious-metals story appears intact. Gold may protect portfolios, while silver could amplify returns—but the right approach may depend more on risk tolerance than market excitement.

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