There was an investment of Rs 31,561 crore in Gold Exchange Traded Funds (ETFs) in the quarter of March 2026. This is almost six times more than the same period last year. The biggest reason for this is geopolitical tension. Investors have once again considered gold as the safest option in the deteriorating environment. On quarter-on-quarter basis, investment increased by 36 percent to Rs 23,132 crore. Apart from this, this year there has been a significant increase in both the asset base (total assets) and investors’ accounts of gold ETFs. In the month of March alone, net investment of Rs 2,266 crore came into this category. This was less than Rs 5,255 crore in February and Rs 24,040 crore in January.
6 times increase
According to the data of Association of Mutual Funds in India (Amfi), with this the total investment in the quarter of March 2026 increased to Rs 31,561 crore, which is much higher than Rs 5,654 crore in the same quarter of March 2025. Although the pace of investment has slowed down a bit as compared to the previous quarter, investors still remain interested in gold related products. The slow pace of investment in March is probably a combination of two reasons: things normalizing after a very strong start to the year, and a slight decline in new allocations.
Nihal Meshram, senior analyst, Morningstar Investment Research India, said that investment was very high in January. The reasons for this might have been risk aversion, rebalancing of the portfolio, and rise in gold prices. For this reason, the figures for subsequent months look comparatively weak. Despite this, the positive data for March shows that amid market uncertainty and major economic fluctuations, investors are still preferring gold as a means to diversify their investments.
3 times increase in AUM
Umesh Sharma, CIO-Debt, The Wealth Company Mutual Fund, said that the pace of investment in gold ETFs slowed down slightly in March. This was less than previous months. The reason for this was probably that the valuation of stock market had become more attractive for investors compared to gold. Thanks to this strong investment, the assets under management (AUM) of gold funds increased almost three times to Rs 1.71 lakh crore by the end of March 2026, from Rs 58,888 crore a year ago. Gold, which has given tremendous returns in recent years, is attracting a lot of interest from investors, as evidenced by the steady increase in the number of folios. This year, the number of folios in gold ETFs increased by 54.28 lakh from 69.69 lakh in March 2025 to 1.24 crore in March 2026. This shows that the trend of investors is increasing towards gold related funds.
What do Janakar say?
According to Meshram, gold ETFs are still attracting investors because they offer an easy, transparent and convenient way to invest in gold without any hassle. He further said that if seen from a broader perspective, the total investment (inflows) in Q1 2026 was Rs 31,561 crore. This shows that even though there may have been some slowdown from month to month, overall this quarter was quite strong for the category. This trend shows that on one hand gold is being used to protect itself from market fluctuations (tactical hedge), and on the other hand it is also being included as an important part of one’s portfolio (strategic allocation).
What is gold ETF?
Gold ETFs, which aim to track the current price of gold in the domestic market, are passive investment vehicles that are based on gold prices and invest in gold bullion. In simple words, gold ETFs are actually units of gold, which can be held in paper or digital (dematerialised) form. One unit of Gold ETF is equal to 1 gram of gold, and is backed by very pure gold. These combine the freedom of investing in the stock market and the simplicity of investing in gold.
