Silver vs Nifty 50: How They Performed During Past Crises; Should You Switch From Equity To Metal?

Last Updated:October 12, 2025, 17:19 IST

Silver outperformed equity and gold in 2025, hitting a 14-year high, driven by demand and supply imbalance, but experts urge caution on both assets.

Silver Vs Nifty 50: Silver has out beaten other asset classes like equity and gold to give the highest return in 2025 so far, with the record high of 14 years. Silver’s unprecedented rally is driven by a factor of reasons: affordability, rising investment demand amid geopolitical tensions & market volatility, growing industrial demand, global resurgence in jewelry demand and Demand-Supply imbalance.

On several previous occasion silver has stood the test of time, hedging investors’ wealth during wars/crises.

According to a report of Kotak Mutual Fund, while Nifty 50 is down by 15 per cent between September in 2024 and March in 2025, silver, however, saw a gain of 3 per cent.

Indian retail investment demand also remained strong, posting a 7% year-over-year gain over the first six months of 2025, Kotak MF report added.

The report mentioned that during Subprime Mortgage crisis in 2008, when Nifty 50 fell 54 per cent between January 01, 2008 and February 27, 2009, Silver gained 13 per cent.

For instance, during the Russia–Ukraine war (Feb–Mar 2022), Nifty 50 fell 10%, while silver prices gained 12%.

However, silver hasn’t always been immune to market pressures. During the Covid-19 outbreak (Feb–Mar 2020), both asset classes took a hit, with Nifty down 33% and silver falling 14%. In the recent market fall (Sep 2024–Mar 2025), Nifty declined 15%, while silver gained 3%, showing relative stability.

The taper tantrum of 2013 saw both assets decline — Nifty 50 slipped 7%, and silver dropped 6%, reflecting broader global uncertainty.

Source: MCX, Bloomberg Direct. Data as on Sep’25

Where Should Investors Go Now Silver Or Nifty 50?

Experts warn that both assets are trading at high valuation now.

Prashasta Seth – CEO, Prudent Investment Managers says, Nifty 50 is still trading at a price-to-earnings ratio of 21x versus its historical long-term average of 18x despite giving 0.3% return in the past 12 months.

Existing earnings growth, he cautions, is anticipated to range from 7-9%, but the valuations already embody much greater optimism.

Seth advises that portfolios in 2025 need to be constructed on valuation discipline. “Don’t overpay for stories, and instead seek out companies where price and fundamentals meet. Investors who concentrate on risk-adjusted entry points instead of chasing momentum will be best placed to create sustainable returns next year,” he adds.

On Silver front, Shweta Rajani, Head – Mutual Funds, Anand Rathi Wealth Limited, as quoted by ET Wealth, says new investors to avoid investing in silver. She argues that price premium is due to mismatch in demand and supply than fundamentals.

Shweta adds that silver has potential to deliver high long-term returns significantly in comparison to Nifty. She further advises investors to avoid making silver a part of their long-term investment portfolio.

Disclaimer: The views and investment tips by experts in this Business.com report are their own and not those of the website or its management. Users are advised to check with certified experts before taking any investment decisions.

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