Summary of this article
The recent run-up and sell-off in precious metals have been a real-time stress test of temperament.
The divergent profiles of gold and silver are shaping portfolio resets.
Gold remains “strategic” and silver is “tactical”, with current volatility and speculative positioning arguing for de‑risking.
India’s wealthy investors are locking in gains from a turbulent run in precious metals, such as gold and silver, and redeploying capital into equities, with gold being retained as a strategic core and silver as a tactical trade. Participation in commodities rally by ultra-high net-worth individuals (UHNI) has been disciplined and instrument-led rather than speculative. Their exposure to gold is primarily through exchange-traded funds (ETFs) and fund of funds (FoFs).
Some had also invested through sovereign gold bonds (SGBs). These instruments are considered liquid and tax-efficient. Silver is mostly treated as a tactical add-on. Metal futures saw very little interest and family offices often took ancillary metal exposure through listed equities in copper and aluminium.
Says Saurabh Goswami, head of UHNI Business at Kotak Private Banking: “Our clients have preferred a strategic blend of gold core with a tactical allocation to silver. On an overall basis, most of our clients allocated 5 per cent in gold ETFs and 2.50 per cent in silver ETFs. In January, there was profit booking in silver. In February, most of our clients exited silver.”
Profit-taking has accelerated since January 2026, with a clear rotation plan for proceeds. “Around half of our clients have already acted and booked profits in January and exited silver completely in February to eliminate noise and crystallise gains,” Goswami added.
Others have trimmed rather than exited, reflecting differing tolerance for drawdowns. The bulk of freed-up capital is being moved into equities. Redeployment is predominantly through direct equity mandates and on a secondary basis, through mutual funds, with a tilt to sectors, such as banking, financial services, and insurance (BFSI), metals, and consumer discretionary, offering earnings visibility and capex tailwinds.
The divergent profiles of gold and silver are also shaping portfolio resets. “We retain a constructive stance on precious metals as a category, but we must separate roles from romance,” Goswami said, adding that gold remains “strategic” and silver “tactical”, with current volatility and speculative positioning for de‑risking.
Client temperament has also driven outcomes through the drawdown. Conservative clients dislike silver’s jumpy profile. They are comfortable monetising gains and resetting risk budgets. A minority remains engaged though. About 5 per cent hold a long‑term perspective on silver. Some even see silver reaching $200 in the long term. Even for this cohort, position sizing has been clipped and redeployment guided by pre‑set asset‑allocation bands.
“We are asking clients to stay invested but stay within their bands,” he said.
Beyond bullion, UHNIs have shown limited appetite for broader commodities. Copper and aluminium have run up, and allocations there are largely through listed equities, not futures.
Looking ahead to 2026, Goswami said clients want two things: timely calls and precise implementation. “Two expectations are explicit. First, proactive identification of tactical opportunities: when to lean in, when to stand down. Second, precise guidance on how to implement in terms of instrument choice, sizing, tax efficiency and phasing,” he added.
For the next leg, the playbook remains measured for UHNIs. Instead of timing the market, they are sticking to a strategic gold core, taking calculated tactical bets, setting clear rules on profit-taking, and taking a bias to redeploy – especially into equities.
