360 ONE Silver ETF: A Silver Shield in Volatile Markets

360 ONE Mutual Fund has launched 360 ONE Silver ETF, it is an open-ended scheme replicating/tracking domestic prices of Silver.

With rising market uncertainties and economic volatility, investors are increasingly exploring alternative assets to diversify their portfolios. One such option gaining traction is silver - a precious metal known for its industrial utility and investment value.

[Read: Top 5 Silver Mutual Funds in India]

360 ONE Silver ETF presents a timely opportunity for Indian investors to capitalize on this outlook. The NFO launch aligns with growing investor interest in alternative assets amid global uncertainties.

What will be the investment strategy for 360 ONE Silver ETF?

360 ONE Silver ETF is a passively managed fund which will employ an investment approach designed to track the performance of domestic price of Silver.

The Scheme will invest at least 95% of its total assets in the Silver or Silver related instruments. It may hold up to 5% of their total assets in debt or money market securities. The Investment Manager would monitor the tracking error of the Scheme on an ongoing basis and would seek to minimize tracking error to the maximum extent possible.

How will the scheme allocate its assets?

Under normal circumstances, 360 ONE Silver ETF will hold an allocation of 95% to 100% in Silver & Silver Related Instruments and 0% to 5% in Debt and money market instruments.

Should investments in 360 ONE Silver ETF be considered?

Investors exploring precious metals as part of their portfolio may find the 360 ONE Silver ETF an intriguing option. This exchange-traded fund offers exposure to silver prices without the complexities of physical storage. Given silver's dual role as an industrial metal and a store of value, understanding its potential in your portfolio is crucial.

Silver has historically been a hedge against inflation and economic uncertainty. 360 ONE Silver ETF tracks the performance of silver prices, allowing investors to participate in silver's potential growth without directly purchasing the metal. This makes it accessible to retail investors seeking exposure to commodities through a regulated mutual fund structure.

Amid prevailing uncertainties, silver has emerged as a promising investment avenue. Notably, India's silver imports have surged in recent months to meet rising demand from industries such as electronics, solar energy, and jewellery. This increased demand could support silver prices, adding potential growth opportunities for investors in silver ETFs.

Since silver often behaves differently from equities and debt instruments, adding it to a portfolio can reduce overall risk. Additionally, the ETF format ensures better liquidity compared to physical silver, making it easier to enter or exit the investment.

However, do note that, while silver prices have long-term growth potential, they are also volatile. Factors like global economic conditions, industrial demand, and changes in monetary policy can significantly impact prices.

As with any commodity-based investment, allocating a reasonable portion of your portfolio rather than overcommitting can help balance potential risks.