Gold ETFs: A look at inflows, AUM and returns ahead of Dhanteras 2026


Gold exchange-traded funds (ETFs) attracted estimated net investments of around ₹3,300 crore in October, while their assets under management (AUM) rose to ₹1.91 lakh crore, compared with ₹1.58 lakh crore in April.

Gold prices have consolidated in recent months, with the metal witnessing a decline of nearly 12% over the last six months.

The movement in prices has coincided with continued investor interest in gold ETFs, which provide exposure to domestic gold prices without requiring investors to purchase physical gold.

Gold ETFs are open-ended mutual fund schemes listed on stock exchanges that track the domestic price of physical gold. One unit typically represents one gram of 99.5% pure physical gold.

Gold ETF returns

According to Value Research data, the gold funds category delivered returns of 6.94% year-to-date, 18.64% over one year, 31.90% over three years and 23.15% over five years, as of October 26.

Among individual schemes, Nippon India Gold ETF BeES recorded one-year returns of 12.58%, followed by Invesco Gold ETF at 12.50% and ICICI Gold ETF at 12.39%.

Since Diwali 2025, celebrated on October 20, gold ETFs have delivered an average return of 9.22%. There were 22 gold ETFs during the period.

What is the outlook for gold?

In its latest quarterly outlook, the World Gold Council said the ongoing festive and wedding seasons are expected to support gold demand. It also noted that central banks continue to add to their gold reserves at historically elevated levels, which could support prices over the coming 12 months.

However, the outlook for gold prices is also subject to global economic and financial conditions.

Pankaj Mathpal, Founder and CEO of Optima Money, said, “The outlook for gold remains positive, supported by strong investment demand and expectations of a modest decline in overall supply. However, higher interest rates, bond yields and a stronger US dollar could create some volatility in gold prices.”

He advised investors against chasing prices or making large lump-sum investments.

“From an investor’s perspective, this is not the time to chase gold prices or make large lump-sum investments. Investors may consider accumulating gold in small quantities through Gold ETFs, keeping in mind their existing portfolio allocation, exposure to gold and long-term financial goals. Gold should primarily serve as a portfolio diversifier and hedge against uncertainty rather than an instrument for short-term speculation,” Mathpal said.

Gold ETFs versus physical gold

Gold ETFs offer an alternative to buying physical gold through jewellery or coins. Physical gold purchases can involve making charges, which can add to the overall acquisition cost. Gold ETFs, being held in demat form, do not involve jewellery-making charges or the need for physical storage.

Investors also do not have to bear expenses such as bank locker charges or concerns around the physical security of their holdings. Gold ETFs are traded on the NSE and BSE during market hours, allowing investors to buy and sell units at prevailing market prices.

Another feature is that investors can take exposure to gold in smaller amounts rather than making a substantial upfront purchase. They can buy ETF units through a demat and trading account, with some schemes also allowing systematic investment plans (SIPs).

However, investors should consider their existing exposure to gold, portfolio allocation and financial goals before increasing investments in the category.

NOTE TO READERS

Disclaimer: This article is for informational purposes only and should not be construed as investment advice. Readers should consult certified experts before making any investment decisions.



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