Silver has played a pivotal role in human civilization, from the silver shekels of Ancient Sumeria to its modern usage across solar panels and electric vehicles. Today, it commands attention not only as a store of value like Gold, but also as a vital industrial metal supporting the global shift to sustainability and technology.
In this bulletin, we explore the investment case for Silver, backed by data on demand, supply, performance, valuation, and use cases.
1. A Market in Deficit: Supply Constraints vs Demand Surge
Global silver supply has remained range-bound between 30,000–32,000 tonnes annually over the past decade. As of 2024:
| Category | Quantity (2024E, in tonnes) |
| Mine Production | ~26,500 |
| Recycling and Scrap | ~5,500 |
| Total Supply | ~32,000 |
| Total Demand | ~36,500 |
| Deficit | ~4,500 (13% of total supply) |
Note: E is Estimated; Source: Metals Focus, World Silver Survey 2025
2025 is projected to be the 5th consecutive year of supply deficit — a structural imbalance that could support prices in the medium to long term.
2. What’s Driving Silver Demand?
Breakdown of global demand (2024E):
Note: E is Estimated; Source: Metals Focus, World Silver Survey 2025
Industrial demand has grown rapidly since 2016 reflecting silver’s rising role in clean tech and electronics.
3. Silver in Emerging Technologies
- Silver is uniquely positioned to benefit from long-term secular trends in green energy and digital infrastructure:
- Silver is critical in solar panels. With solar installations growing at a double-digit rate, photovoltaic-related silver demand may exceed 7,000 tonnes annually by 2030.
- EVs use 25–50g of Silver per vehicle, nearly double that of an Internal Combustion Engine (ICE). With rising EV sales, the demand for Silver could reach over 2,500 tonnes annually by 2030.
- Other Uses: Silver is vital in medical devices (antibacterial properties), 5G infrastructure (conductivity), and semiconductors (high purity), thereby expanding its role in the healthcare and high-tech sectors.
Silver is no longer just “precious” — it’s strategic.
4. Silver vs Other Assets: Market Performance
Historical returns across Silver, Gold, Nifty 50, and S&P500 –
Note: SI: Silver futures contract traded on commodities exchanges; GC: Gold futures traded on commodities markets; NSEI: Nifty 50 index; US500: S&P 500 index.
Source: Investing.com
The chart compares the performance of Gold (GC), Silver (SI), the US500 (S&P 500), and the NSEI (Nifty 50) over the last 3-year period. Gold (+88.12%) and Silver (+82.09%) have significantly outperformed both US500 (+52.03%) and NSEI (+47.77%), indicating a strong run for precious metals amid global market conditions.
As seen from the chart above, Silver (SI) outpaced Gold (GC) from April 2023 to December 2024, delivering more substantial returns during that period before Gold pulled ahead in early 2025. These periods are also characterized by inflation, monetary loosening, or equity selloffs.
5. Silver’s Diversification Advantage
Silver shows low correlation with both the Nifty 50 and the S&P 500, typically ranging between -0.3 to +0.3, offering potential diversification benefits in equity-heavy portfolios.
| Asset Correlation | Nifty50 | S&P500 |
| Silver | -0.3 to 0.3 | |
During crisis periods, Silver has rebounded sharply after an initial fall:
- During the COVID-19 crash (March 2020), Silver initially fell but rebounded strongly within six months, thereby outperforming equities.
- In 2008, Silver Prices dropped sharply from March to October but recovered strongly by mid-2009 as monetary stimulus boosted metal prices.
6. Relative Valuation: Gold-Silver Ratio
The Gold-Silver Ratio (GSR) — currently ~91 — is viewed as a signal of relative under/overvaluation:
- Historical average (last 30 years): ~65
- Peak during COVID (2020): 125
- Today: 91 → implies potential undervaluation of silver relative to Gold
Investors often monitor this ratio to rebalance positions between Gold and Silver.
Final Thoughts: Should Silver Shine in Your Portfolio?
Silver continues to evolve from a monetary metal to a modern industrial necessity. With long-term tailwinds from the adoption of renewable energy, the electrification of mobility, infrastructure, and the rollout of 5G, as well as supply deficits resulting from limited mining growth.
Thus, it offers an attractive risk-reward profile when viewed through a long-term lens.
Potential role in your portfolio:
- Hedge against inflation & currency debasement
- Diversifier in equity-heavy portfolios
- Thematic exposure to clean tech, EVs, and digitization
As always, consult your financial advisor to evaluate how Silver fits into your asset allocation strategy.
Disclaimer: The data in this presentation is meant for general reading purposes only and is not meant to serve as a professional guide/investment advice for the readers. This presentation has been prepared based on publicly available information, internally developed data, and other sources deemed reliable and credible. Whilst no action has been suggested or offered based upon the information provided herein, due care has been taken to endeavor that the facts are accurate and reasonable as of this date. The information presented is for informational purposes only and does not constitute an offer to sell or buy a security.
The Company reserves the right to make modifications and alterations to the content available on the presentation. Readers are advised to seek independent professional advice and arrive at an informed investment decision before making any investment.
The EduFund platform and website are owned, operated, and maintained by Helena Edtech Private Limited, a company incorporated under the laws of India. An affiliate of the Company, Edubillions Tech Private Limited, is registered with AMFI as a mutual fund distributor, bearing registration number ARN 258733. Investing in the securities market is subject to market risks; please read all related documents carefully before investing. The valuation of securities may fluctuate depending on the factors affecting the securities market.
