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Investors now can take advantage of Silver ETFs in portfolio diversification: Experts

With the introduction of norms for silver exchange traded funds ([ETFs], investors will be able to invest in silver in a more liquid manner and help diversify the portfolio

Investors now can take advantage of Silver ETFs in portfolio diversification: Experts
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Investors now can take advantage of Silver ETFs in portfolio diversification: Experts 

With the introduction of norms for silver exchange traded funds ([ETFs], investors will be able to invest in silver in a more liquid manner and help diversify the portfolio. The Securities and Exchange Board of India (Sebi) came out with operating norms for silver ETF, whereby such scheme will have to invest at least 95 per cent in silver and silver-related instruments. The norms will be effective from December 9, 2021.

"Now people will be able to hold silver commodity by investing into silver ETF. Since it is a highly regulated product, investors will be certain about its purity unlike when they buy silver from open market," said Swapnil Bhaskar, Head of Strategy, Niyo-- a neo-banking platform for millennials to invest.

Priti Rathi Gupta, Founder, LXME -- financial platform for women -- said "now investors will be able to invest in silver in a more liquid manner compared to the traditional methods of investing in silver".

Also, this will help in diversification of the portfolio as silver has been a precious metal, after gold, she said.

"It will become very convenient for investors to have exposure to silver as a commodity in a transparent manner, in addition to their exposure to gold," Hemen Bhatia, Deputy Head - ETF, Nippon Life India Asset Management Ltd, said.

Under the norms, silver ETF scheme will be benchmarked to the price of silver (based on London Bullion Market Association or LBMA silver daily spot-fixing price) and the net asset value (NAV) of such ETFs will be reported on a daily basis on the AMC's website.

Dwaipayan Bhattacharjee
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