Gold ETF vs Silver ETF
Gold ETFs and Silver ETFs are both types of exchange-traded funds (ETF) that provide exposure to the respective precious metals.
However, there are some key differences between the two.
Difference Between Gold ETF & Silver ETF
| Cost of investment | The cost of investing in gold ETFs is slightly higher as the prices of gold are higher than silver. | Silver ETFs are more reasonably priced |
| Volatility | Gold has limited uses as compared to silver. Therefore, the prices of this metal are not affected more due to economic fluctuations. Hence, investment in gold ETFs is less volatile. | Silver has wide industrial uses Therefore, the demand for this metal is highly volatile as compared to gold which ultimately impacts its prices. |
| Liquidity | The demand for gold ETFs is higher as compared to silver ETFs which makes them more liquid. | Silver ETFs are less liquid as compared to gold ETFs. |
| Returns | Although the demand for silver is varied and wide as compared to gold, the returns generated by gold ETFs are higher. | The returns from silver ETFs are impacted due to volatility in demand for this metal as well as the higher expense ratio. Therefore, returns from silver ETFs are lower as compared to that from gold ETFs. |
Silver ETFs were recently launched in the Indian markets. they are fast becoming favourite investment product on account of many benefits over investment in traditional silver.
Gold ETFs are considered to be more stable investment options as compared to Silver ETFs. Hence, the gold is more suitable for moderate risk investors while the silver is ideal for aggressive investors.
CONCLUSION
Overall, the decision to invest in a gold ETF or a silver ETF will depend on your investment objectives and risk tolerance. Gold may be a better choice for those seeking a safe-haven asset, while silver may be more attractive to investors who are willing to take on greater risk for the potential of higher returns.
