Earlier in our blog we had sighted Silver’s undervaluation that now appears to be realized with gains of 126.5% in the last 1 year.
For more information, please refer to the previous blog linked below (28th Feb, 2025)
Gold vs Silver: Time to Rebalance?
- Over the past year, silver delivered a powerful catch-up rally as the gold–silver ratio corrected from extreme levels.
- As of 20 December 2025, the ratio has fallen to ~64, down from above 90 earlier in the year driven not by weakness in gold, but by strong silver outperformance.
- 2025 marked a breakout year for silver, with prices crossing $69 per ounce and gains exceeding 120%, supported by structural supply deficits, rising industrial demand from AI, solar, and EVs, and broader macro uncertainty. Indian markets mirrored this momentum, with silver prices crossing ₹2 lakh per kg in December.
With the ratio now closer to long-term averages, the ratio suggests silver may no longer be the clear valuation outlier it once was. While it may still offer tactical opportunities, the easy gains from extreme undervaluation appear behind us.
Gold, meanwhile, is likely to re-emerge as the portfolio anchor. Central-bank demand, geopolitical risk, and constructive forward views including those from Goldman Sachs can continue to support gold’s role as a stabilizer in uncertain times.
Bottom line: Silver has caught up. From here, gold may take center stage, while silver may shift toward a more tactical role as the cycle evolves.
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