Gold Exchange-Traded Funds Attract Over Rs 31,561 Crore in March Quarter Amid Geopolitical Tensions

Gold ETFs Witness Six-Fold Surge in Inflows in March Quarter

Gold Exchange Traded Funds (ETFs) saw a significant surge in inflows of Rs 31,561 crore in the March 2026 quarter, marking a nearly six-fold increase compared to the same period in the previous year. This surge comes amidst heightened geopolitical tensions, as investors sought the safety of traditional safe-haven assets.

The quarterly inflows rose 36% on a quarter-on-quarter basis to Rs 23,132 crore. The asset base of gold ETFs, along with investor accounts, recorded substantial growth during the year. In March alone, the category saw net inflows of Rs 2,266 crore, lower than Rs 5,255 crore in February and Rs 24,040 crore in January.

The total inflows in the March quarter of 2026 were sharply higher than Rs 5,654 crore in the corresponding quarter of 2025, according to data from the Association of Mutual Funds in India (Amfi). Despite a moderation in the pace of inflows, investor interest in gold-backed products remained positive.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

The slower inflows in March likely reflect a combination of normalisation after a strong start to the year and some moderation in fresh allocations. The strong inflows in the first quarter helped drive the assets under management (AUM) of gold funds nearly three-fold to Rs 1.71 lakh crore by the end of March 2026, from Rs 58,888 crore a year earlier.

Gold, which has delivered strong returns in recent years, has attracted significant investor interest, with the steady rise in folio numbers. During the year, folio numbers in gold ETFs increased by 54.28 lakh to 1.24 crore in March 2026 from 69.69 lakh in March 2025.

According to Nehal Meshram, Senior Analyst, Morningstar Investment Research India, gold ETFs remain appealing because they offer a liquid, transparent, and convenient way to gain exposure to the metal without the frictions of holding physical gold.

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline

The trend suggests that gold continues to be used both as a tactical hedge and as a strategic portfolio allocation. Gold ETFs, which aim to track the domestic physical gold price, are passive investment instruments that are based on gold prices and invest in gold bullion.