Rutam Vora (Commodity Online)
AHMEDABAD: As the uncertainty on the currency derivatives is looming large and gold investments became less yielding in the time of reduced physical demand from consumers, traders have found an attractive investment instrument from silver for their investors as bullion traders are now mulling to launch silver ETFs in India.
Mumbai-based one of the leading bullion trading firms in India, RiddiSiddhi Bullions Ltd (RSBL) is aiming to launch silver ETF in Indian market. Speaking to Commodity Online, RSBL MD, Prithviraj Kothari said, Silver is the latest investment destination with comparatively healthy return against gold and currency. Looking at the market potential we are now considering to launch silver exchange traded fund (ETF).
In India, currently no company offers silver ETF. If RSBL comes up with its special investment product, it will have the first mover's advantage. We have already filed for the regulatory approvals and awaiting green signal from the authorities. Once we obtain the approval, ours will be the benchmark price for silver ETF, Kothari added.
Continued declines in the confidence of the U.S. dollar have led many national banks to seek out ways to reduce their exposure to the greenback. Many have opted to shift reserve holdings into hard currency, sending precious metals prices skyrocketing in recent sessions.
After the mad gold-rush that lead the yellow metal prices touching historic highs of over USD 1200 per ounce, it is now no longer considered as an attractive heaven mainly on the ground of the fact that average return on the investment has reduced to as low as 6-9%, against which silver that is predominantly used in the industrial applications has now become a hot favourite commodity to be traded on the commexes, with average return being almost 3-4 times higher than that in gold.
RSBL, a Rs.7900 crore bullion trading firm, is an authorized participant (AP) of all the gold exchange traded funds (ETFs) in India and is also the largest creator and redeemer of such units of these funds. The company enjoys trading relations with important London Bullion Market Association (LBMA) members in international markets. In India, RSBL has expanded its business with presence in major Indian bullion trading centres.