Today’s Silver Rate

Silver Rate in India

India is the largest consumer and importer of silver. Although the demand for silver has been under pressure due to weak industrial demand and depreciation in currency, increased trade uncertainty and economic instability lifted the demand for silver. Between gold and silver, the latter has been a preferred choice of masses for jewellery and investment by virtue of being more affordable. If you are a small investor and have a low capital then instead of going for gold investment, it is better to invest in silver.

Trend of Silver Rate in India for Last 10 Days

Historical Chart: Last 6 Months Silver Price Trend in India

Also Check For:

Gold Rate Today : Hyderabad | Kerala | Mumbai | Delhi | Bangalore | Pune | Kolkata | Chennai

Silver Rate Today : Bangalore | Hyderabad | Delhi | Chennai | Mumbai | Ahmedabad | Jaipur

Silver Standards

In India, silver of various purities and grades are available, but the most pure form is 99.9% silver – fine silver. Fine silver is mainly used for various industrial applications but it can’t be used in jewellery. One of the most commonly used silver standards is the sterling silver (92.5%) which is often referred to as the 925 standard. In 92.5% of the total weight, the rest of the percentage is copper.

Types of Silver

999 Pure Silver: Fine silver is used for investment or trade on commodities exchange and is stamped with a hallmark that certifies its purity. The reason why it is reserved for investment is because it is considered too soft for jewellery use.

92.5 Sterling Silver: Sterling silver consists of 92.5% pure silver and the remaining part consists of copper and zinc. The reason why it is combined with other metals is because fine silver (0.999) is relatively soft and malleable to make Sterling Silver jewellery. So, silver is usually alloyed with copper that helps to increase its hardness and strength. This is the reason why jewellers are capable of making the most intricate designs with 925 Sterling Silver. Usually, people buy silver jewellery of this grade. One can know the 925 Silver rate by given formula: (999 silver price/100)*92.5.

Argentium: Argentium contains silver which depends on its grade (935-93.5% or 960-96% pure silver) and the rest of the composition is made up of other alloys. It is more durable if compared with other grades.

How to Invest in Silver?

Investing in silver is affordable due to its price. Silver coins can be bought with a few hundred rupees unlike gold where you have to invest in thousands. Moreover, investors can choose different grades of silver to invest in. Sterling grade, also called grade 925, and above are considered good for investment. Following are some of the ways to invest in silver:

• One way to invest in silver is buying silver coins and silver bars, which one can buy from banks, bullion traders (MMTC) or through commodity exchange such as MCX. One can buy silver bars through MCX in long-dated contracts, usually available up to 6 months and then roll them over. Investors have to bear brokerage charges at the time of roll over but s/he can be assured of any purity or storage issues.
• Investors can start their systematic investment plan (SIP) in silver with National stock exchange online with an investment of as low as Rs.1000 on a monthly basis. The tenure is usually in the range of 1 to 10 years. After the end of the tenure, customers can request delivery of their accumulated silver in the form of coins.

How to trade in Silver?

Listed below are the two ways to trade in silver:

1. NSE (National Spot exchange) allows you to trade in e-silver. Investors need to open their account with their depository participants. One can also take physical delivery. The futures unit of silver is 100 gm and you can take delivery in 100 gm, 1 kg, 5kg or a combination.
2. One can also trade in the commodity futures market in India through MCX. There are four variants of silver contracts one can trade on MCX which are Silver, Silver Mini, Silver Micro, Silver 1000. In the equity market, settlement is always in cash but in the commodities market the settlement is always physical and therefore ‘delivery’ is compulsory. Delivery is mandatory for silver contracts but it is not for the Silver Mini and Silver Micro contracts. That is, investors can settle for cash if Silver mini/micro expires.

Why should you invest in Silver?

Below are some of the reasons why investing in silver can be your best bet:

Gives more returns than gold: Silver is worth around 1/79th the price of gold which makes white metal affordable compared with gold. It was noticed in 2008 to 2011 that silver gained 448 percent while gold gained just 166 percent in that same period. Considering the increasing demand for silver in various industries, its price will continue to go up which makes it a better investment option.

Demand: In recent years, the demand for silver has increased many folds by the industrial sectors. This gives an individual a good reason to invest in this white metal.

Hedge against inflation: If the economy is going down either due to political or economic uncertainty, silver can hedge you against inflation by mitigating the risk.

Helps you to diversify your portfolio: To mitigate risks arising from geopolitical situations, many people invest in silver as their best. It is because in the past it is seen that silver correlates to inflation positively.

How to Buy Silver in India?

Investors can buy the silver either in its physical form (silver bars or coins) or from the futures market (commodity exchanges). Earlier, silver bars weren’t available in less than 1 kg which demanded a significantly higher investment and also came with storage-related problems. Now silver bars are available from 100 gm onwards, making it easier for investors to purchase and store the metal.

How to Sell Silver in India?

If you are selling silver, you want to get the best price available. However, it also depends on what kind of silver you are selling. Is it jewellery, coin, and bar?. You can sell silver jewellery to the same store you have bought for a fair price. Although the jeweller won’t repay the GST you have paid but you will get a value close to the market price. Silver bars generally have high resale value and will fetch you more than you have paid. You can sell silver bars either at a local silver dealer or through online silver dealers.

GST on Silver

Silver is taxed at 3 percent. With a lower taxation bracket, many unorganized players will be encouraged to enter organized trade.

What is MCX Silver?

MCX stands for Multi Commodity Exchange. It is an exchange for trading commodities which consists of energy, metals (gold and silver), livestock amongst other such commodities. One can purchase and sell silver future contracts at the MCX.

How is the Silver Rate Calculated in MCX?

Silver rate is quoted in 1 kg respectively in MCX and international silver prices are quoted in troy ounce. To calculate silver price, MCX is dependent on the following aspects:

• International price
• USD to INR rate conversion
• Quoted unit for gold and silver
• Troy ounce to grams conversation
• Supply and demand for silver in MCX trading

1 gm silver price – International silver price*USD to INR rate conversation/ Troy ounce to grams conversation.

* One troy ounce=31.1034768

Silver Price Performance

Through the following table, you can evaluate the performance of silver over the last 5 years:

Why does the silver rate fluctuate in India?

There are certain factors that cause the silver rates in India to fluctuate so much and some of them have been discussed below:

Investment: As we all know the market for silver is not as big as that for gold. This is why unusually high investment in silver tends to affect its price. This phenomenon was seen in 1998 when billionaire Warren Buffet invested nearly $680 million in silver. At that time, the price of gold was falling and also of silver and this investment prevented the prices of silver from hitting an 18 year low.

Directly proportional to gold rates: It has been noticed that the price of silver tends to follow the same trends as that of gold. If the gold rate rises or falls due to factors like demand-supply change in cost of importing, silver rates also tend to follow the same route.

US dollar and rupee equation: It is seen that there exists an inverse relationship between silver prices and US dollar. The US dollar is trading at an average of Rs.71 to the dollar, which is making the procurement of silver more expensive. As the dollar gains strength against rupee, the price of silver will increase which in turn affects the price of silver.

Fluctuating Industrial demand for silver: Unlike gold, silver has a much larger industrial application with the metal being used for electronics, medical equipment, water purification, etc. which has led to the demand for silver to increase considerably. This in turn drives the prices of silver.

Apart from the above-mentioned factors, there are number of other factors which cause silver rates in India to fluctuate such as geo-political uncertainties, rising crude oil prices, government policies, direction of gold prices and direction of other commodity prices.

Factors that influences the demand for silver

Demand in the domestic market: India is one of the biggest contributors to international demand for silver. Thus, any changes in the Indian domestic market will have a good influence on international prices.

Monsoon: If the forecast suggests maximum probability for normal rainfall during the season, the demand for silver will increase. This is because a good monsoon period leads to better agricultural output and hence a stronger rural demand. Traditionally, it is seen there is a direct correlation between the increase in agricultural output and demand for silver.

Exchange rates: Silver prices do not get influenced by many global factors but an uptick in US dollar index affects silver rate in India negatively and vice versa. A weak rupee will put an additional burden on customers, as it will lift the landed cost of the commodity in the country.

Emerging markets: From the last few years, there has been a noticeable rebound in industrial demand for silver in emerging markets. Boom in technology directly affects the prices of silver as most of the industries have started taking advantage of physical characteristics found in silver which later results in increase in silver demand.

Global economic scenario: Weak global economic outlook and increased geopolitical instability increases the demand for silver as more and more people look for safe haven which bullion market (silver and gold) offers.

How to check the Purity of Silver?

It is always recommended to buy only a hallmarked silver article as it certifies the purity of the silver jewellery and coin you bought. The system for grading silver purity is called millesimal fineness and is expressed in a decimal. There are three components to check silver purity and they are:

• BIS mark
• Assaying/Hallmarking centre’s identification mark/number
• Jeweller’s identification mark/number
• If you have bought jewellery before 1st January 2017, then check for the year of marking denoted by a code letter. e.g. ‘R’ for year 2013
• Purity grade / fineness (table given below)

Important Aspects

Before investing in silver, there are certain aspects that every investor should know and they are as follows:

• Investment in silver comes with an inherent risk. So, as a prudent measure, it is always advisable to keep the exposure to this asset class limited to 10 percent of the overall investment portfolio.
• There are also purity related issues with buying physical silver. If you are buying silver coins from a jeweller, then make sure that the jeweller selling the metal is willing to buy it back at a later date. It is best to confirm from them the terms and conditions at which they will buy back the metal at a later date.
• Buy silver coins and jewellery from a reputed jeweller where you are assured about its purity. By doing so, you will get the value close to the market value at the time of selling.
• Before investing and resale, it is important for an investor to carry out proper research about the current trends in the market, silver rates in India. For information about the price analysis, take the help of the experts, apps and different websites
• Always ask for a proper receipt whenever you buy any silver ornament and make sure the receipt mentions the purity of the silver, weight of silver, gemstone weight and making charges separately.

FAQs

Q1. How much does it cost to get a silver article hallmarked?

The jeweller needs to pay Rs25/- per article to get their silver article hallmarked. Apart from that, minimum charges per consignment is Rs.150 excluding service tax.

Q2. What is hallmark silver?

Hallmarking is the accurate determination and official recording of the silver content in silver jewellery and coins. BIS is the accreditation agency, which is authorised to hallmark gold as well as gold jewellery and coins. It is being done to protect consumers from irregular silver quality. It is used in other countries as well which assures consumers that they have got the right purity of silver article for the given price.

Q3. Can I get 100% pure silver?

No, 100% pure silver is too soft to produce any jewellery item. Therefore, metals like copper and zinc are used in the composition that helps in giving strength to the silver article and makes it more durable. Silver jewellery and coins are available in different purity levels. For e.g. 92.5% silver contains 92.5% silver and 7.5% other metals.

Q4. What is E-silver?

National Spot Exchange introduced E-silver which helps investors to invest their funds into silver in small denominations (100 grams) and hold it in demat form. It enables investors to buy, accumulate, hold and liquidate as well as to convert the same into physical coin and bar. Silver will be stored in exchange designated vaults and will be tradeable on the national stock exchange platform.

Q5. Is paper silver and e-silver one of the same thing?

Earlier people used to invest in silver by buying silver bars and coins. However, one can invest through National Spot Exchange and commodity market, which will hold your silver purchase in demat form (paper form).

Q6. Is there any silver loan scheme available in India?

Yes, the Central bank of India has a gold and silver loan scheme for farmers to help them meet their agriculture credit needs. Farmers need to pledge silver coins or jewellery of 0.999 purity and then can avail term loan subject to terms and conditions.

Q7. What is the import duty on silver?

In Union Budget 2019, the import duty charged on silver went from 10% to 12.5%

Q9. What is Oxidised Silver?

It is a sterling silver but its surface has been intentionally darkened through a chemical process. However, this treatment doesn’t change the color and properties of the metal.

Q10. Can I invest in Silver ETF?

Currently, there is no ETF in silver. At present, interested investors can invest in silver through e-silver, physical buying, and demat form.

Also Check For:

Gold Rate Today : Hyderabad | Kerala | Mumbai | Delhi | Bangalore | Pune | Kolkata | Chennai

Silver Rate Today : Bangalore | Hyderabad | Delhi | Chennai | Mumbai | Ahmedabad | Jaipur