ETMarkets Smart Talk| Gold, silver or copper? Tata MF fund manager suggests

Benchmarks Nifty23,810.85370.05FEATURED FUNDS★★★★★Motilal Oswal Midcap Fund Direct-Growth5Y Return18.38 % Invest NowFEATURED FUNDS★★★★★UTI Aggressive Hybrid Fund Regular Plan-Growth5Y Return9.24 % Invest NowEnter search text:

The Economic Times daily newspaper is available online now. Read Today's Paper ETMarkets Smart Talk| Gold, silver or copper? Tata MF fund manager suggests a 50:30:20 commodity allocation: Tapan PatelBy Kshitij Anand, ETMarkets.comLast Updated: Nov 04, 2026, 08:48:00 AM ISTSynopsis

In this edition of ETMarkets Smart Talk, we speak with Tapan Patel, Fund Manager – Commodities at Tata Asset Management, who shares his outlook on gold, silver, copper and crude oil, explains the changing dynamics driving commodity prices, and suggests a 50:30:20 allocation to gold, copper and silver, respectively, for investors looking to build a commodity portfolio for the long term.

Listen to this article in summarized format

Loading...×Gold, silver and copper are increasingly finding a place in investors' portfolios, but with global markets witnessing sharp swings, changing interest rate expectations and geopolitical uncertainties, how should investors approach these commodities?

While gold has come under pressure from a stronger US dollar and higher US bond yields, copper continues to draw support from its long-term demand prospects, driven by electrification, AI infrastructure and the energy transition.

So, should investors look beyond gold to diversify their commodity exposure? And how should they position their portfolios for the next five years?

In this edition of ETMarkets Smart Talk, we speak with Tapan Patel, Fund Manager – Commodities at Tata Asset Management, who shares his outlook on gold, silver, copper and crude oil, explains the changing dynamics driving commodity prices, and suggests a 50:30:20 allocation to gold, copper and silver, respectively, for investors looking to build a commodity portfolio for the long term. Edited Excerpts –

Q) October has been a month of sharp divergence across commodities. What has been the biggest driver behind the contrasting moves in gold, crude oil and copper?

Live Events

A) We have seen non-linearity amongst commodities this year as commodities are following individual fundamentals apart from general correlation. The biggest driver for this divergence is shift in investors positioning due to geo-economic factors.

Nowadays investors have become more selective in terms of asset allocation especially towards defensive assets. We have seen this shift specifically in Gold and Copper. Gold has lost the tag as a ‘defensive asset’ as higher US bond yields are attractive despite of market uncertainty.

Copper is relatively stable in the current year with supportive market fundamentals despite of global economic distress. Crude oil is anyway at firm levels over supply disruption due to US – Iran conflict now termed as ‘Gulf War 3’.

Q) Gold has fallen below the $4,000-an-ounce mark, while crude has rallied sharply. Is this primarily an inflation story, a geopolitical story or a shift in investor positioning?

A) Gold and Crude oil are positively correlated in war like scenario considering historical data. This correlation is absent in the current scenario, and we may call it a mix of all three factors. The stronger dollar – ‘petrodollar’ in the start of the US-Iran conflict diminished demand for bullion as a defensive asset.

Later in the year, tech driven rally and higher bond yields in US pressured bullion prices against high yielding assets. While the higher inflation prompted US Fed to adopt a hawkish stance which is currently affecting the price movement over higher probabilities of further rate hikes.

Q) Copper has weakened despite its long-term role in electrification and infrastructure. Is the recent correction a buying opportunity or a warning that global industrial demand is slowing?

A) Copper prices are trading near at $14450 per ton at LME off from all-time highs of $14875 per ton made in September 2026. (Bloomberg) Prices are witnessing short term headwinds due to macro factors. The long-term demand prospect is bright considering higher usage in electrification and AI related infrastructure.

Additionally, tariff related speculation around US Section 232 has also supported copper prices making ex-US market tight. Any weakness in prices due to short term surplus numbers or slower demand may be considered a market correction while long term trend being supportive over higher demand and supply deficit.

Any change or shift in US trade policy specific to section 232 may ease some of the supply tightness from the physical market.

Q) How do higher interest rates typically affect gold, crude oil and copper differently? Why shouldn't investors treat all three commodities as one asset class?

A) In simple terms, higher interest rates mean reduction in money supply and tighter liquidity. Central banks typically increase interest rates to cool down inflation, lowering consumer spending with higher return over cash savings. The effect of interest rate hike may vary as per the economic scenario and geopolitical conflicts.

Hence, Investors may evaluate gold, copper and crude oil differently due to non-linearity among them. In economic distress, the rate hike is negative for gold, copper and crude oil while in growth period, the rate hike impact may remain negative for gold, but may impact positively for copper and crude oil due to economic expansion.

Apart from this, the geopolitical factors like war, tariffs may play individual part which may change cross asset correlation.

Read more: Beyond tech: Kotak MF’s Shibani Kurian on India’s next innovation-led winners

Q) If the Fed holds rates in October but signals tighter policy ahead, could gold remain under pressure even without an immediate rate hike?

A) Commodity prices respond largely to the impact on the probability of an event happening in the future rather the actual happening. The US Fed adopted hawkish stance in September 2026 sighting one more rate hike in December 2026.

The global market has factored this impact in the prices including gold. If US Fed chairman signals tighter policy beyond December 2026 without an immediate rate hike, global market may respond to the fresh inputs, and gold prices may see further pressure against the quantum of the possible rate hike. This all depends on the comments on guidance from the US Fed and rate forecast.

Q) Gold has corrected sharply in October after a strong run. What would convince you that this is a healthy correction rather than the beginning of a prolonged downtrend?

A) Gold prices have remained under pressure over less supportive macro factors including higher yields, stronger dollar and rate hike from central banks. Considering global market scenario and developments in past few years, we believe structural long term supportive factors are still in play.

The macro situation may shift anytime with change in geopolitical factors and repercussions. A couple of major factors pertaining to US macros and US – Iran conflict are weighing on gold as of now which depicts that current selling may be considered as a short-term correction which may change anytime.

Q) Should retail investors consider commodities as a separate allocation within a diversified portfolio, or should most investors stick to equities, bonds and gold?

A) Past few years have been developmental for the global commodities market and for the investors in terms of asset allocation.

The rise of protectionism in terms of tariffs, tighter trade policies has increased the race to secure hard commodities among the countries. On top of it supply disruptions due to change in weather pattern, natural calamities have made commodities more price sensitive to the smaller supply shocks.

We believe increased capex into infrastructure related to AI, renewables, decarbonisation and EV trend may increase demand for commodities in the longer term. Investors may take beyond gold approach to diversify the asset allocation into commodities along with equity and fixed income markets.

Read more: ET Wealth Expo 2026| India's next investment mega trend is a $1.5 trillion wealth transfer: Ganesh Mohan

Q) What are the biggest mistakes retail investors make when entering commodities after a sharp rally or buying a dip during a correction?

A) Commodity prices generally reflect to demand -supply factors and the price trend are generally cyclical in nature as per seasonality, weather patterns and economic cycles.

Investors may avoid making mistakes considering it as a “perpetual bull run” into a commodity after a sharp rally. One should understand demand – supply shifts, historical price trend and cyclical moves.

Buying a dip during a correction may help to build effective portfolio. However, investors may need to consider roll over costs and change in supply demand dynamics to check over supply or demand destruction scenario.

The biggest mistake to avoid is getting biased to the trend or the position despite of unfavourable market condition.

Q) Finally, if an investor is building a portfolio for the next five years, what role would you assign to gold, silver and industrial commodities—and what would you avoid?

A) As discussed, gold has its own structural supportive factors for the long term, and we believe one should look at gold as a strategic asset making a fix allocation to the portfolio. Silver and industrial commodities like copper have seen higher demand from various industries in recent years.

This demand shift and lower supply may support these commodities in next five years. However, the economic scenario may impact the performance of these commodities making it more data dependant.

For an investor looking to build commodity portfolio for next five years an asset mix of Gold, Copper and Silver is ideal with 50:30:20 ratio respectively.

One should avoid taking exposure in commodities where data and information access is less or hard to interpret to assess the market condition. Finally, investor may need to stick to proper risk management and avoid taking short term speculative bets.

Analyst Disclaimer: The views expressed in this article are personal in nature and in is no way trying to predict the markets or to time them. The views expressed are for information purpose only and do not construe to be any investment, legal or taxation advice. Any action taken by you on the basis of the information contained herein is your responsibility alone and Tata Asset Management Pvt. Ltd. will not be liable in any manner for the consequences of such action taken by you. Please consult your Financial Advisor before investing. The views expressed in this article may not reflect in the scheme portfolios of Tata Mutual Fund. The view expressed are based on the current market scenario and the same is subject to change. There are no guaranteed or assured returns under any of the scheme of Tata mutual Fund.

Mutual Fund investments are subject to market risks, read all scheme related documents carefully.

(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times)
Add as a Reliable and Trusted News Source Add Now!
(You can now subscribe to our ETMarkets WhatsApp channel)
Read More News onTapan PatelTata Asset Managementcommodity allocationgoldcoppersilvercrude oil

(What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

...moreless
(You can now subscribe to our ETMarkets WhatsApp channel)
Read More News onTapan PatelTata Asset Managementcommodity allocationgoldcoppersilvercrude oil

(What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

...morelessPrime ExclusivesInvestment IdeasStock Report PlusePaperWealth Edition

• Some elections matter more than you know: No crop changed in the fields, yet sugar, coffee and soya got cheaper in a day

• You can buy a walkie-talkie online. But can you legally use it?

• KYB and KYC: Quick commerce, the Damani premium and what DMart must deliver – 3rd and concluding part

• KYC and KYB: Inside Damani’s DMart, the retail chain for the middle class. And stock for the long term? – Part 2 of 3

• Will it be a regulatory nightmare if an exchange lists on its own platform?

• KYC and KYB: Inside Damani’s Avenue Supermarts that refuses to charge more – Part 1 of 3

• 1
• 2
• 3

View all StoriesContinue reading with one of these options:Limited AccessFreeLogin to get access to some exclusive stories
& personalised newslettersLogin NowUnlimited AccessStarting @ Rs120/monthGet access to exclusive stories, expert opinions &
in-depth stock reportsSubscribe NowET

Unlock Access to All Exclusives with ETPrime FREE TRIAL

15 Days Free: Unlock All ETPrime Exclusives, Market Tools & ePapers

Trial offer expiring in00 : 05 : 00

I'd rather pay ₹2599 now

Uh-oh! This is an exclusive story available for selected readers only.

Worry not. You’re just a step away.

Prime Account Detected!

It seems like you're already an ETPrime member with

Login using your ET Prime credentials to enjoy all member benefits

Log out of your current logged-in account and log in again using your ET Prime credentials to enjoy all member benefits.

Unlock ETPrime's Exclusive Stories Today!

Big Price Drop! Flat 40% Off

Student Only OfferAlready a Member? Sign In nowAlready a Member? Sign In nowAlready a Member? Sign In now

Offer Exclusively For You

Save up to Rs. 700/-

ON ET PRIME MEMBERSHIP

Avail Offer

Offer Exclusively For You

Get 1 Year Free

With 1 and 2-Year ET prime membership

Avail Offer

Offer Exclusively For You

Get 1 Year Free

With 1 and 2-Year ET prime membership

Avail Offer

Offer Exclusively For You

Get Flat 40% Off

Then ₹ 1749 for 1 year

Avail Offer

Offer Exclusively For You

ET Prime at ₹ 49 for 1 month

Then ₹ 1749 for 1 year

Avail Offer

Special Offer

Get flat 40% off on ETPrime

Avail OfferAvail OfferClaim NowAlready a Member? Sign In now

Need Assistance?

Connect with an ETPrime expert for personalized support and guidance

+91 9484700004'; }); } if(listing) { var h3 = "You tried reading " + listArr.length + " locked stories in the past " + threshold + " days.", h4 = "Become an ET Prime member and don't miss out on these exclusive stories."; var html = '

' + h3 + '

' + h4 + '

' + listing + '

'; $('#paidSCWidget').html(html); var callback = $('#paidSCWidget').attr('data-callback'); if(callback && window[callback]) { window[callback](); } customDimension.dimension72 += ' | Shown SYFT no Trial_With Missed Paywalled Articles Collection'; } else { _processNormal() } } }); } else { _processNormal(); } } catch (e) { _processNormal(); } }, function () { _processNormal(); }); //console.log('storyCollectionLoad', $); }

What’s Included with

ETPrime Membership

1Exclusive Insights That Matter

Uncover the truth with our investigative stories

Make strategic moves using the real-world case studies

Read industry-specific stories to identify emerging trends

Spot opportunities with
in-depth insights that matter

• Trump temper on H-1B visas is forcing Indians to do these things to stay put in US

  What Adani’s US indictment means for India Inc’s overseas fundraising

• Why veterans like Reliance, L&T are on acquisition spree? Aswath Damodaran has an answer.

  Will China’s dollar bond sale in Saudi Arabia trump the US in financial world?

• Huawei launches its own OS to compete with Google and Apple. But can it win beyond China?

  The problem with lab grown diamonds

• Why a falling rupee is a better option for the economy

  A list of top 20 momentum stocks that have delivered massive returns in one year

2Invest Wisely With Smart Market Tools & Investment Ideas

Alpha Trade

Get daily trade ideas from SEBI-registered research analysts.

Investment Ideas

Grow your wealth with stock ideas & sectoral trends.

Stock Reports Plus

All-in-one stock research with Stock Score, peer comparison & key signals.

BigBull Portfolio

Get to know where the market bulls are investing to identify the right stocks.

Stock Analyzer

Check the score based on the company's fundamentals, solvency, growth, risk & ownership to decide the right stocks.

Market Mood

Analyze the market sentiments & identify the trend reversal for strategic decisions.

Stock Talk Live at 9 AM Daily

Ask your stock queries & get assured replies by ET appointed, SEBI registered experts.

3Stay informed anytime, anywhere with ET ePaper

ePaper - Print View

Read the PDF version of ET newspaper. Download & access it offline anytime.

ePaper - Digital View

Read your daily newspaper in Digital View & get it delivered to your inbox everyday.

Wealth Edition

Manage your money efficiently with this weekly money management guide.

TOI ePaper

Read the PDF version of TOI newspaper. Download & access it offline anytime.

Deep Explainers

Explore the In-depth explanation of complex topics for everyday life decisions.

Health+ Stories

Get fitter with daily health insights committed to your well-being.

Personal Finance+ Stories

Manage your wealth better with in-depth insights & updates on finance.

5Enjoy Complimentary Subscriptions From Top Brands

Stream new documentaries from all across the world every day.

Stories you might be interested in