Gold and silver keep soaring to record highs, but is it a boom or a bubble?
Published by India Today
Abhishek Kumar's role: Quoted
Abhishek Kumar said the commodity cycle may still be at an early stage but cautioned about timing risk, and suggested a small tactical allocation of up to 5% across commodities while adding equity at lower valuations.
What Abhishek Kumar said
Was the rise in gold and silver early or late in the commodity cycle?
When we spoke in January 2026, I felt we were likely in the early stages of a cyclical uptrend in commodities that could last two to five years, depending on supply. The risk is timing: historically, equities have tended to peak about five months before a recession, while commodities peak only around two months after, so the uptrend could be cut short if economic growth disappoints.
Why did silver rise for reasons beyond its safe-haven appeal?
Silver is also an industrial metal. Its industrial demand had surged because supply had fallen short of demand for five years in a row, and because it was being used more and more in solar energy, electric vehicles and the hardware that goes into AI data centres. That industrial pull came in addition to its role as a precious metal.
Can equities recover after a weak stretch while commodities are strong?
Historical data supports equities rebounding after weak periods. Mean reversion tends to speed up when uncertainty is high, which suggests that rebounds can come faster in volatile markets. Early in a recovery, equities and commodities can both do well at the same time, particularly if inflation stays modest, so one does not have to rule out the other.
How should investors approach precious metals after a big rally?
I saw real risk in timing a move into commodities at that point, especially precious metals. My suggestion was a tactical allocation of up to 5% of the portfolio, spread across a mix of commodities rather than concentrated in a few metals, while adding to equity at lower valuations. Commodities could climb more if stagflation or fresh geopolitical shocks set in, but demand destruction and buying near a cycle peak are real risks.
In our words, from what he said in the piece. General information, not personal advice.
More of Abhishek's views on money management
After a sharp rally in gold and silver through 2025, prices dipped in January 2026 as geopolitical tension eased. The article asks whether precious metals are replacing equities, what drove the surge, why silver also has industrial demand, and how investors might balance the two asset classes.
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Gold and silver keep soaring to record highs, but is it a boom or a bubble?