Commodity mutual funds invest in various commodities like precious metals, grains, etc. So, silver commodity funds invest in silver.
The objective of these funds is to generate decent returns by investing in silver.
These funds are suitable for investors with a moderate risk appetite. These funds can be a good option for investors bullish on silver or for investors looking to diversify their portfolio by investing in commodities. We are not very bullish on silver and other commodities as the preferred assets for long-term investments. But if investors still want to invest in silver, then we feel that a silver ETF can be a good option. In India, there are no mutual funds options for silver as only ETFs are available for this category. We believe that conservative investors can diversify a small part of their portfolios into commodities like gold and silver. At the same time, asset allocation in commodities should be limited to a maximum of 20% of the portfolio.