The ICICI Prudential Silver ETF has emerged as the top-performing fund in the silver ETF category, delivering a 107.1% return over the past year as of August 12, 2026. While the fund has outperformed peers like Aditya Birla Sun Life Silver ETF and Kotak Silver ETF, investors should remember that silver is a volatile commodity and past gains do not guarantee future results.
The ICICI Prudential Silver ETF has secured the top position among major silver exchange-traded funds (ETFs) in India, recording a compound annual growth rate of 107.1% over the one-year period ending August 12, 2026. This performance places it slightly ahead of other large competitors, including the Aditya Birla Sun Life Silver ETF and the Kotak Silver ETF, which also reported significant gains of 106.9% and 106.8% respectively for the same period.
These performance metrics are based on funds with assets under management (AUM) exceeding ₹1,500 crore, capturing the most prominent players in this segment. The rally in these ETFs is primarily a reflection of the strong performance of physical silver prices in both domestic and international markets over the past twelve months.
Understanding Commodity ETF Risks
While the returns over the past year have been significant, investors should approach commodity ETFs differently than equity-based mutual funds. Silver ETFs are designed to track the domestic price of physical silver. This means the fund's performance is almost entirely tied to the price movement of the underlying commodity. Unlike companies that can improve profit margins or grow revenue, silver is a metal, and its value is dictated by global supply, demand, and economic factors.
These funds carry a 'Very High' risk rating, as recognized by regulators and industry standards. Silver prices are known for sharp fluctuations, and the ETF price can be affected by factors beyond the control of the fund manager, such as changes in global industrial demand or shifts in investor sentiment toward precious metals. Additionally, ETFs may face 'tracking error,' which occurs when the fund's returns deviate slightly from the actual silver price due to the costs of storing physical silver, insurance, and administrative expenses.
What Investors Should Monitor
Investors looking at this space should focus on more than just recent performance figures. Because these funds are tied to a physical commodity, the key monitorable for the future will be the global price trend of silver. Factors such as industrial demand for the metal, changes in interest rates, and currency fluctuations—specifically the rupee against the dollar—often impact silver prices significantly.
It is also important to consider that short-term leadership can shift quickly between funds. While one ETF may lead over a one-year window, others may perform differently over shorter time frames depending on how well they manage tracking errors and liquidity. Before investing, individuals should evaluate their own risk tolerance and consider whether their portfolio needs exposure to a volatile commodity, keeping in mind that the impressive returns seen over the past year are historical and cannot be taken as an indicator of future performance.