Analysis of Volatility in Indian Commodity Market with Reference to Gold and Sliver

The present study analyses the volatility and price behaviour of gold and silver in the Indian commodity market and compares their performance with the BSE Sensex. Gold and silver are widely considered important investment assets because of their role in wealth preservation, inflation hedging, and portfolio diversification. The study adopts a descriptive and analytical research design based on secondary data. The analysis covers a five-year period, with a detailed month-wise examination of gold and silver prices during the final year of the study. Data relating to gold, silver, and the BSE Sensex were analyzed using statistical tools such as return analysis, mean, standard deviation, variance, and correlation analysis. The findings reveal that both gold and silver recorded an overall upward trend during the study period, particularly in the later years. Gold demonstrated comparatively stable price behaviour and consistent growth, whereas silver showed greater fluctuations along with higher return potential. The BSE Sensex also exhibited steady growth and relatively lower volatility, highlighting its importance as an alternative investment avenue. The comparative analysis indicates that precious metals performed strongly in certain periods when compared with the stock market. Correlation analysis revealed a strong positive relationship between gold and silver, indicating that both metals generally moved in the same direction and were influenced by common economic and market factors. The study concludes that gold offers relatively greater stability and may be suitable for long-term wealth preservation, while silver provides higher growth opportunities with comparatively greater risk. Overall, both precious metals can play an important role in portfolio diversification. Investors should consider their risk tolerance, investment objectives, and prevailing market conditions while making investment decisions. A balanced investment approach combining precious metals and equity investments may help achieve an appropriate balance between risk, return, and stability

Gold, Silver, Volatility, Commodity Market

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