Do not invest in silver, it may crash: Experts

Some talk of silver crossing mark of Rs50,000 per kg while some forecast Rs1 lakh level in three years. But experts recommend to stay away from silver at current level.

“The cartels formed in the international market which have been on heavy buying spree to take the silver prices to around $30 per ounce have been incidental for the rally. If profit booking takes place in the month of December, then a correction to the extent of 30-40% is likely by January, 15. But if the profit booking does not take place, then the prices can spurt to as high as Rs50,000,” said Girish Choksi, former president at Choksi Market Association of Ahmedabad.

Echoing Choksi’s view, Shanti Patel, president at Gem and Jewellery Trade Council of India said, “At these prices, it is not advisable to invest in bullion as the path ahead is still uncertain over global cues.”

Mumbai-based bullion expert, Bhargava Vaidya believes that silver may see correction of up to Rs6,000 per kg any time. “Some news on silver may bring down silver prices from $29 an ounce to $19 ounce any time. So I suggest investors to not put money in silver right now,” he said.

Despite rising prices, the demand for silver is rising in Ahmedabad. “Customers are afraid of silver touching mark of Rs1 lakh per kg in next three years. So they prefer buying it today itself without wasting time. The demand is simultaneously seen in yellow metal also. Without any festive season, customers want to become ‘safe buyer’ but purchasing both the precious metal now,” said Manoj Soni of AB Jewels.

Dilip Sarkar, secretary of Ahmedabad Gold-Sliver Jewellery Traders’ Association said that he has never seen such appreciation in silver prices in his lifetime. “After a certain growth in prices, we have seen correction but in this year, correction is taking place and so everyone is confused,” he said.