Massive Rally In Gold And Silver: Should You Rebalance Your Portfolio?

Gold and silver prices have surged sharply in 2025, making these precious metals one of the most talked-about asset classes this year. 

While gold has delivered one of its strongest performances in decades, it is silver that has truly captured investor attention. Since the beginning of the year, silver prices have jumped over 120%, touching the historic Rs 2 lakh-per-kilogram level.

Gold, too, has seen an exceptional run in 2025, rising more than 60% after scaling over 50 all-time highs during the year, according to various reports.

In India, gold prices in Mumbai have climbed from nearly Rs 78,000 per 10 grams at the start of 2025 to almost Rs 1.35 lakh per 10 grams, a jump of roughly 72% within the year.

Market watchers suggest that 2026 could also be a strong year for precious metals, depending on geopolitical developments and tariff-related issues. Usually precious metals grow through cycles.

After an exceptionally strong 2025, gold prices are expected to remain range-bound in 2026. But if economic growth slows or central banks cut interest rates further, gold could still deliver moderate returns. In a severe downturn, gains could be even stronger.

Silver’s surge past the Rs 2 lakh mark is being supported by a combination of international factors, strong manufacturing demand, and a weaker rupee.

Experts cited by a Times of India report suggest that silver has been outperforming gold in both global and domestic markets, with industrial demand and softer dollar conditions providing additional momentum.

Technical assessments indicate that the current breakout could push prices further, while support levels around Rs 1.90 lakh to Rs 1.86 lakh may act as buffers against sharp declines.

Given the strong performance of gold and silver in 2025, investors may consider reviewing their portfolio allocations. While the bullish sentiment is expected to continue as per reports, strategic rebalancing can help manage risk and capture potential gains from the current rally.

Over the past year, investment demand for gold and silver has surged, largely due to geopolitical tensions, global trade uncertainties and a tariff war unleashed by the US administration. Demand trends in India mirror global trends.

Apart from strong investment interest, rupee depreciation has added pressure on prices, as India imports much of its gold. Gold imports reached a record $14.72 billion in October, aided by purchases during the festive season and for weddings.

Gold ETFs, too, have seen significant inflows, with over Rs 31,300 crore added between January and November 2025, which is almost three times the inflows recorded in the same period in 2024.

In addition, the Pension Fund Regulator has now allowed the National Pension System (NPS), Unified Pension Scheme (UPS) and Atal Pension Yojana to invest in silver and gold ETFs, potentially leading to further inflows into precious metals.