Gold/silver ratio explained: Meaning, current trends & India insights

Gold and silver often feature in investor conversations, especially during phases of heightened volatility or inflation concerns. Although both are precious metals, they differ in terms of market size, industrial demand and price sensitivity. To understand how the two are positioned relative to each other at any point in time, investors often look at the gold/silver ratio — a metric that compares the price of gold to the price of silver. This article tells you more about what the gold/silver ratio is, how it’s calculated, and its relevance in commodities investing.

Table of contents

• What is the gold/silver ratio?
• How is the gold/silver ratio calculated?
• Gold/silver ratio in 2026 – trends
• Current gold/silver ratio – What does it indicate?
• Gold/silver ratio in India – why it matters to Indian investors
• Historical trends of the gold/silver ratio
• How investors trade using the gold/silver ratio
• Does the gold/silver ratio indicate when to buy?
• An alternative route to gold and silver: Multi-asset allocation funds

What is the gold/silver ratio?

It is a number that tells you how the market is pricing one metal against the other. The gold and silver ratio is a simple measure to compare the relative cost of the two precious metals.
Strip away the jargon and here is the definition of gold and silver ratio: how many ounces of silver does it take to buy one ounce of gold?

How is the gold/silver ratio calculated?

At its simplest, you compare the two prices directly — gold divided by silver expressed in the same units.

For instance, if gold is trading at Rs. 1.5 lakh per 10 grams and silver at Rs. 2,400 per 10 grams, the comparison works out to 62.5. This means gold is priced at 62.5 times the price of silver on a per-unit basis. In other words, one gram of gold would be equivalent in value to 62.5 grams of silver at that moment. The arithmetic itself is straightforward. The real question is whether that figure signals balance or stretch.

Gold/silver ratio in 2026 – trends

Silver and gold have seen a rally in 2025-2026 with growing investor interest in the precious metals because of increased geopolitical tensions, market volatility, and macro uncertainty pushing investors toward defensive assets. For silver, industrial demand has further fuelled the rally. Gold prices globally rose by nearly 65% in 2025, from around $2,600 per ounce to over $4,300 by year-end, according to a report by Forbes. The same report said that silver prices grew even more notably, by 150% in 2025, ending the year at around $72 per ounce.

Sources: Gold shines on, Forbes India, February 10, 2026; Commodity Markets Outlook, World Bank, October 2025.

Recent data indicates notable volatility in the gold/silver ratio across different time frames.

• Last 30 days: High – 66.23 | Low – 44.02
• Last 60 days: High – 66.23 | Low – 44.02
• Last 1 year: High – 103.95 | Low – 44.02

Source: Goldprice.org, gold/silver ratio charts; data as on February 19, 2026.

The one-year high of 103.95 (recorded in April 2025) suggests that, at its peak, gold was trading at nearly 104 times the price of silver on a per-ounce basis — a historically elevated level. In contrast, the recent low of 44.02 indicates periods where silver strengthened relative to gold, narrowing the gap significantly.

The wide range between the annual high and low reflects substantial shifts in relative performance between the two metals over the past year. Such movements are often influenced by changing macroeconomic conditions, investor demand, industrial usage trends (particularly for silver), and global risk sentiment.

Also read: Gold and Silver ETF Inflows Beat Equity Funds in January 2026: What’s Driving Investor Interest?

Current gold/silver ratio – What does it indicate?

• Market conditions: A high reading often indicates that silver is trading at a lower price relative to gold based on historical comparisons. A compressed reading indicates that silver has gained ground. Gold can surge when investors prioritise stability. At other times, booming industrial demand for silver may tighten the spread.
• Investment decisions: It may be considered as one of several reference indicators across physical metals, Gold and Silver ETFs, precious metal mutual funds and other instruments. However, while the ratio provides insight into relative valuation at a given point in time, it does not in itself predict future price direction and may be interpreted alongside broader market factors.
• Impact on gold loans: When the ratio rises, it indicates gold has strengthened relative to silver, though gold-loan demand is primarily influenced by absolute gold prices and credit conditions.

Past performance may or may not be sustained in future.

Gold/silver ratio in India – why it matters to Indian investors

In India, the gold and silver ratio comparison carries extra weight. Gold is not just an asset but also part of tradition, where it also factors into inheritance and celebration. Silver, though not as favoured, has steadily carved out its own place in Indian investor portfolios.

In fact, India stands among the largest consumers of both metals. Import duties, festival seasons, retail buying patterns nudge local pricing in ways that do not always mirror global charts perfectly. When that gap moves, it is not just an academic exercise — it can influence real allocation decisions.

Historical trends of the gold/silver ratio

Long-term averages from historical price data show that the gold-silver ratio was around 53 in the early 1980s, rising above 80 during stress periods like 2020–21 when gold outperformed silver. By early 2026, it compressed to the mid-60s range (around 64:1) as silver gained prominence recently.

Over decades, the ratio fluctuated widely – low when silver was strong, high when gold was stronger during uncertainty. Historically, a ratio between 60–70 is typical, with bigger swings during economic shocks or sharp commodity cycles.

For example, in 2020, amid the COVID-19 pandemic, the figure surged past 125 — an unusually wide separation that left silver trading at a steep discount to gold.

Source: All Data Gold Silver Ratio History, goldprice.org, data as on February 19, 2026.

Factors affecting the gold/silver ratio

• Economic uncertainty
• Industrial demand for silver
• Geopolitical tension
• Currency strength and liquidity conditions

It is rarely one domino falling but rather the broader environment adjusting that affects the gold and silver ratio.

How investors trade using the gold/silver ratio

Some investors treat the ratio as a compass. When the figure climbs high, silver can look inexpensive next to gold, prompting allocations through Silver ETFs or mutual funds. When the gap narrows, capital sometimes rotates back toward gold.

There’s also a commonly used “80-50” approach — accumulating silver when the ratio exceeds 80 and moving toward gold near 50. However, these are informal approaches based on historical patterns, not guarantees of future performance.

More advanced traders may hedge by holding positions in both metals simultaneously. The aim is not to guess direction but to capture the relative movement.

Past performance may or may not be sustained in future.

Does the gold/silver ratio indicate when to buy?

Investors can use the gold and silver ratio to adjust their portfolio by buying precious metals when they appear to be undervalued. A high gold/silver reading may suggest that silver is undervalued, revealing buying opportunities. The same applies when the value is low – it shows a window of opportunity to invest in gold.

However, the gold-silver ratio alone should not be used to make buying decisions. It must be used in conjunction with other factors such as broader macro trends, liquidity cycles, and investor sentiment for analysis.

An alternative route to gold and silver: Multi-asset allocation funds

Multi-Asset Allocation Funds are hybrid mutual funds invest across several asset classes — such as equities, debt and commodities like gold and silver — subject to minimum 10% investment in each asset class. By combining multiple assets that may respond differently to market conditions, such funds aim to deliver diversified exposure and potentially smoother risk-return outcomes.

The Bajaj Finserv Multi Asset Allocation Fund is one such scheme. The fund has taken strategic exposure to gold and silver in response to evolving metal conditions, tapping into their potential for capital appreciation in some market conditions and their role as portfolio stabilisers in others.

The fund also routinely adjusts its allocation to gold and silver based on relative performance trends between the two metals (reflected through the gold-silver ratio), indicating an active and management style that responds to evolving market conditions rather than sticking to fixed weights. To invest in the Bajaj Finserv Multi Asset Allocation Fund and to view scheme-related and statutory details, click here.

Conclusion

The gold-to-silver ratio encapsulates a shifting relationship between the prices of the precious metals, gold and silver, into a single reference point. Does it predict the future? No. Does it remove risk? Not at all. But it provides perspective — and in markets, perspective can help reduce reactive decision-making. Thus, the gold and silver ratio has endured because it simplifies something complex and helps investors find potential investment opportunities.

FAQs:

What is the 80-50 gold-silver rule?

It refers to buying silver when the ratio moves above 80 and rotating toward gold as it approaches 50, based on historical relative valuation swings.

What is considered a good gold to silver ratio?

There is no fixed level that can be considered universally “good,” as the gold/silver ratio fluctuates across market cycles. Historically, readings between 50 and 70 have occurred frequently over extended periods. When the ratio moves significantly above or below such historical ranges, it tends to attract attention from market participants assessing relative valuations. However, the ratio alone does not determine future price movements. Past performance may or may not be sustained in future.

What is the highest gold/silver ratio ever recorded?

During the COVID-19 pandemic, the ratio climbed above 125 in 2020, reflecting a substantial discount in silver relative to gold at that time.

How to use the gold-silver ratio?

Most investors use it to judge relative value of both precious metals. Instead of focusing only on whether gold or silver is rising, they compare the two and adjust exposure if the balance appears stretched.

Why is the gold and silver ratio popular?

Watching how gold and silver move in relation to each other continues to offer context to investors, even as monetary systems evolve. t is popular because it is simple to interpret and offers a quick relative comparison.