A 70:30 strategy could help investors balance gold and silver exposure: Tata Mutual Fund

Tata Mutual Fund suggests a 70:30 investment strategy between gold and silver to balance exposure in precious metals. Both metals are expected to perform well in the medium to long term, but gold is favored due to its stability and defensive characteristics, while silver offers long-term growth potential. Gold's recovery was supported by softer US economic data and easing bond yields, and its long-term prospects are bolstered by central bank purchases and the need for portfolio diversification.

Silver, on the other hand, has significant industrial demand and could experience higher volatility due to global growth slowdown and rising interest rates. The fund recommends a staggered approach to silver with a medium-to-long-term investment horizon. Geopolitical uncertainty, a strong US dollar, and a Federal Reserve focused on inflation have negatively impacted both metals in recent times.

However, gold's defensive appeal and persistent demand from China support a long-term outlook for silver. Gold currently has the edge over silver, with domestic prices outperforming international prices in India.