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Ramalingam Kalirajan |11060 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on Feb 20, 2026

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more

Question by Rahul on Feb 20, 2026Hindi

Hello Ramalingam Sir. For investment purpose, which will be a better metal. Gold or Silver? Also should I buy the physical metal or opt for ETF or is there any other better way of buying it?

Ans: It is great that you are looking at diversifying your portfolio with precious metals. Adding gold or silver is a smart way to protect your wealth against inflation and market swings. As a Certified Financial Planner, I like that you are thinking about the "how" and not just the "what" when it comes to investing.

» Gold versus Silver for your portfolio

Gold is usually seen as a safe place to keep money when the world or the economy is messy. It does not move as much as silver, which makes it a steady choice for long-term safety. Silver is different because it is used a lot in industries like electronics and solar panels. This means silver prices can jump up or down very fast based on how well factories are doing. If you want stability, gold is better. If you can handle a bumpy ride for a chance at higher returns, silver is an option, but gold is the standard for most portfolios.

» The problem with ETFs and the power of active management

You asked about ETFs as a way to buy these metals. While they seem easy, they have some big downsides. ETFs are passive, meaning they just follow the market price without any brain work behind them. In a volatile market like India, being passive can mean you miss out on better timings or better asset mixes.

This is why I often suggest looking at actively managed funds instead. In an active fund, a professional fund manager makes smart choices about when to buy or sell. They look at the 360-degree view of the economy to protect your money. Passive options like ETFs don't care if the market is crashing; they just follow it down. Active management gives you a better chance to beat the market.

» Why physical metal might not be the best

Buying physical gold or silver has many hidden costs. You have to pay for making charges, which can be 5% to 15% extra. Then you have to worry about where to hide it and pay for bank lockers. When you sell it, jewelers might take a small cut for purity checks. This makes physical metal a bit expensive and risky to hold in large amounts.

» A better way to invest through a MFD and CFP

If you want a 360-degree solution for your wealth, investing through a Mutual Fund Distributor (MFD) who is also a Certified Financial Planner is very helpful. Many people try to do "direct" investing to save a tiny bit on fees, but they often make big mistakes because they don't have expert guidance.

When you use regular plans through a professional, you get a coach. We help you stay calm when prices fall and make sure your gold or silver fits with your other investments. This expert advice usually saves you much more money than the small cost of the regular plan. It ensures your paperwork is correct and your family is looked after if something happens to you.

» Finally

Gold is a fantastic hedge for an Indian household. Instead of just buying coins or following a passive ETF, it is better to have a plan that looks at your whole life. Using active funds and working with a professional will keep your investment journey smooth and successful.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.