Contents
Gold funds of funds pause new investment (October 2026)
On 15 October 2026, at least 15 fund houses issued notices suspending fresh investment in their gold funds of funds from 16 October: Aditya Birla Sun Life, Axis, DSP, HSBC, ICICI Prudential, Invesco, Kotak, LIC, Mirae Asset, Nippon India, SBI, Shriram, Tata, UTI and Zerodha. Kotak and Mirae Asset applied it to their gold-and-silver funds of funds as well.
- Paused: new lump-sum purchases, additional purchases, switch-ins, and new SIP and STP registrations. Many fund houses also stopped SIP top-ups and step-ups.
- Still running: existing SIP and STP instalments, redemptions, switch-outs and SWPs.
- Not affected: buying and selling gold ETF units on the stock exchange through a demat account. The notices cover funds of funds only.
Most notices say the pause applies until further notice; ICICI Prudential and Aditya Birla Sun Life describe fresh subscriptions as discontinued. None of the notices gives a reason, and each presents the decision as the fund house’s own. Reuters reported, citing a fund executive and bullion industry officials, that the move followed discussions with SEBI. As of 16 October 2026, SEBI had not commented or issued a circular on it.
It is the second limit on gold funds this year. In June 2026, HDFC Mutual Fund, citing “broader economic and market conditions”, stopped large direct subscriptions to its gold ETF and capped lump sums in its gold fund of funds, and other fund houses followed; those limits were lifted later. This section will be updated when fund houses change the October pause.
All gold ETFs compared
Largest fund first. An ETF has a single plan. Tracking difference is the ETF’s return minus its benchmark’s over the past year, so a smaller negative number is better; tracking error shows how much the daily gap varied. Returns are compound annual, from NAVs to 15 October 2026, after the expense ratio.
| Gold ETF | Expense ratio | Tracking difference, 1 year | Tracking error | 1 year | 3 years | 5 years | Average assets |
|---|---|---|---|---|---|---|---|
| Nippon India ETF Gold BeESNippon India Mutual Fund | 0.81% | −1.46% | 0.41% | 14.04% | 34.06% | 23.48% | ₹56,306 cr |
| ICICI Prudential Gold ETFICICI Prudential Mutual Fund | 0.49% | −1.09% | 0.47% | 14.37% | 34.39% | 23.76% | ₹27,185 cr |
| SBI Gold ETFSBI Mutual Fund | 0.65% | −1.32% | 0.43% | 14.18% | 34.24% | – | ₹25,899 cr |
| HDFC Gold ETFHDFC Mutual Fund | 0.59% | −1.21% | 0.39% | 14.27% | 34.31% | 23.65% | ₹23,492 cr |
| Kotak Gold ETFKotak Mahindra Mutual Fund | 0.52% | −1.13% | 0.38% | 14.35% | 34.27% | 23.68% | ₹14,346 cr |
| Tata Gold Exchange Traded FundTata Mutual Fund | 0.39% | −1.19% | 0.66% | 15.75% | – | – | ₹6,006 cr |
| Axis Gold ETFAxis Mutual Fund | 0.52% | −1.40% | 0.75% | 14.11% | 34.39% | 23.69% | ₹5,471 cr |
| UTI - Gold Exchange Traded FundUTI Mutual Fund | 0.59% | −0.95% | 0.29% | 15.31% | 34.86% | 23.86% | ₹3,414 cr |
| Mirae Asset Gold ETFMirae Asset Mutual Fund | 0.35% | −1.16% | 0.57% | 14.41% | 34.27% | – | ₹3,371 cr |
| Aditya Birla Sun Life Gold ETFAditya Birla Sun Life Mutual Fund | 0.44% | −1.00% | 0.42% | 14.45% | 34.37% | – | ₹2,936 cr |
| DSP Gold ETFDSP Mutual Fund | 0.45% | −1.09% | 0.50% | – | – | – | ₹2,633 cr |
| Zerodha Gold ETFZerodha Mutual Fund | 0.35% | −1.06% | 0.57% | 14.49% | – | – | ₹2,454 cr |
| Motilal Oswal Gold ETFMotilal Oswal Mutual Fund | 0.59% | −1.59% | 0.68% | 14.09% | – | – | ₹1,876 cr |
| Edelweiss Gold ETFEdelweiss Mutual Fund | 0.50% | −1.34% | 1.15% | 14.26% | – | – | ₹1,709 cr |
| LIC MF Gold Exchange Traded FundLIC Mutual Fund | 0.45% | −1.12% | 0.47% | – | – | – | ₹1,441 cr |
| Quantum Gold ETFQuantum Mutual Fund | 0.61% | −0.99% | 0.29% | 14.33% | 34.50% | – | ₹754 cr |
| Invesco India Gold Exchange Traded FundInvesco Mutual Fund | 0.50% | −1.19% | 0.45% | – | – | – | ₹753 cr |
| HSBC Gold ETFHSBC Mutual Fund | 0.62% | – | 1.55% | – | – | – | ₹669 cr |
| GROWW Gold ETFGroww Mutual Fund | 0.71% | −1.56% | 0.56% | – | – | – | ₹453 cr |
| Baroda BNP Paribas Gold ETFBaroda BNP Paribas Mutual Fund | 0.59% | −1.39% | 0.53% | 14.21% | – | – | ₹324 cr |
| Union Gold ETFUnion Mutual Fund | 0.49% | −1.42% | 0.78% | 14.21% | – | – | ₹289 cr |
| Bandhan Gold ETFBandhan Mutual Fund | 0.45% | – | 1.03% | – | – | – | ₹181 cr |
| 360 One Gold ETF360 ONE Mutual Fund | 0.47% | +1.66% | – | 14.22% | – | – | ₹135 cr |
| Angel One Gold ETFAngel One Mutual Fund | 0.35% | – | 0.71% | 14.35% | – | – | ₹85 cr |
| Choice Gold ETFChoice Mutual Fund | 0.51% | – | 0.00% | – | – | – | ₹50 cr |
| The Wealth Company Gold ETFThe Wealth Company Mutual Fund | 0.34% | – | 2.23% | – | – | – | ₹27 cr |
Expense ratios (total, including brokerage and levies) as disclosed on 16 October 2026; tracking error as of 16 October 2026; tracking difference from AMFI’s monthly disclosure of 1 September 2026; average assets for July–September 2026. All from AMFI. A dash means the fund is too young for the period, AMFI has no figure, or a unit split makes the NAV history not comparable. The order is by size; it is not a ranking or a recommendation.
All gold funds of funds compared
Largest fund first. The expense ratio is the fund of funds’ own; the gold ETF it holds charges its own expense ratio as well, inside that ETF’s NAV. Returns are for the direct plan, compound annual, to 15 October 2026, after both layers of cost.
| Gold fund of funds | Expense ratio, direct | Expense ratio, regular | 1 year | 3 years | 5 years | Average assets |
|---|---|---|---|---|---|---|
| SBI Gold FundSBI Mutual Fund | 0.25% | 0.42% | 13.76% | 34.13% | 23.74% | ₹16,897 cr |
| HDFC Gold ETF Fund of FundHDFC Mutual Fund | 0.20% | 0.47% | 13.59% | 33.95% | 23.59% | ₹11,865 cr |
| Nippon India Gold Savings FundNippon India Mutual Fund | 0.06% | 0.25% | 13.67% | 33.98% | 23.41% | ₹7,332 cr |
| Kotak Gold FundKotak Mahindra Mutual Fund | 0.15% | 0.45% | 14.17% | 33.95% | 23.38% | ₹6,913 cr |
| ICICI Prudential Gold ETF FOFICICI Prudential Mutual Fund | 0.18% | 0.56% | 13.90% | 34.19% | 23.59% | ₹6,850 cr |
| Axis Gold FundAxis Mutual Fund | 0.31% | 0.55% | 13.22% | 33.62% | 23.52% | ₹3,074 cr |
| Aditya Birla Sun Life Gold FundAditya Birla Sun Life Mutual Fund | 0.21% | 0.52% | 13.23% | 34.15% | 23.63% | ₹1,770 cr |
| Tata Gold ETF Fund Of FundTata Mutual Fund | 0.24% | 0.64% | 13.49% | – | – | ₹1,483 cr |
| UTI Gold ETF Fund of FundUTI Mutual Fund | 0.07% | 0.46% | 13.88% | 34.48% | – | ₹1,446 cr |
| LIC MF Gold ETF Fund of FundLIC Mutual Fund | 0.35% | 0.61% | 12.14% | 33.87% | – | ₹825 cr |
| Mirae Asset Gold ETF Fund of FundMirae Asset Mutual Fund | 0.11% | 0.69% | 14.43% | – | – | ₹589 cr |
| Quantum Gold ETF FOFQuantum Mutual Fund | 0.06% | 0.46% | 13.73% | 34.37% | 23.65% | ₹553 cr |
| DSP Gold ETF Fund of FundDSP Mutual Fund | 0.64% | 1.00% | 13.83% | – | – | ₹530 cr |
| Invesco India Gold ETF Fund of FundInvesco Mutual Fund | 0.12% | 0.56% | 14.86% | 33.72% | 23.49% | ₹492 cr |
| HSBC Gold ETF Fund Of FundHSBC Mutual Fund | 0.07% | 0.44% | – | – | – | ₹377 cr |
| Zerodha Gold ETF FoFZerodha Mutual Fund | 0.28% | No regular plan | 14.24% | – | – | ₹371 cr |
| Union Gold ETF fund of fundUnion Mutual Fund | 0.32% | 0.57% | 13.88% | – | – | ₹166 cr |
| Bandhan Gold ETF FOFBandhan Mutual Fund | 0.11% | 0.58% | – | – | – | ₹159 cr |
| Groww Gold ETF FOFGroww Mutual Fund | 0.14% | 0.36% | 12.80% | – | – | ₹126 cr |
| Edelweiss Gold ETF Fund of FundEdelweiss Mutual Fund | 0.12% | 0.59% | – | – | – | ₹47 cr |
| Angel One Gold ETF FOFAngel One Mutual Fund | 0.20% | 0.70% | 14.38% | – | – | ₹35 cr |
| The Wealth Company Gold ETF FOFThe Wealth Company Mutual Fund | 0.23% | 0.68% | – | – | – | ₹16 cr |
| Shriram Gold ETF Passive FOFShriram Mutual Fund | – | – | – | – | – | ₹1 cr |
| Baroda BNP Paribas Gold ETF Fund of FundBaroda BNP Paribas Mutual Fund | 0.12% | 0.48% | 13.26% | – | – | – |
Gold-and-silver funds of funds are left out. Expense ratios as disclosed on 16 October 2026; returns from Direct-Growth NAVs; average assets for July–September 2026, all plans. All from AMFI. A dash means the fund is too young for the period or AMFI’s figure looks wrong. The order is by size; it is not a ranking or a recommendation.
What is a gold ETF?
A gold ETF is a mutual fund that holds physical gold and trades on the stock exchange like a share. SEBI requires it to invest at least 95% of its assets in gold and gold-related instruments. The gold is held as standard bars of 99.5% purity that meet the London Bullion Market Association’s Good Delivery standard, and the fund’s auditors verify it.
Up to half the fund can be in gold-related instruments instead of bars: gold deposit and gold monetisation schemes (at most 20% together) and exchange-traded gold derivatives. Since April 2026 the gold is valued at the spot price polled by the exchanges.
How you buy and sell
You buy and sell gold ETF units on the NSE or BSE through a broker and a demat account, at the market price during trading hours. Each fund appoints at least two market makers to keep prices close to the value of its gold, and publishes an indicative NAV (iNAV) during the day. If an ETF trades more than 1% below its NAV for seven trading days in a row, investors can redeem directly with the fund house. Since September 2026, gold ETFs have their own price bands, starting at 6% either way.
What is a gold fund of funds?
A gold fund of funds is a mutual fund that puts at least 95% of its money into a gold ETF, usually its own fund house’s. You invest in it like any other mutual fund, at the day’s NAV, with no demat account, and you can run a SIP. It has direct and regular plans; the direct plan has no distributor commission.
You pay two layers of cost: the fund of funds’ own expense ratio, shown in the table below, and the expense ratio of the gold ETF it holds, which is already taken out of that ETF’s NAV.
Gold ETF or gold fund of funds?
- Account: an ETF needs a demat and trading account; a fund of funds does not.
- Price: an ETF trades at the market price, which can be above or below the value of its gold; a fund of funds is bought and sold at the day’s NAV.
- Costs: an ETF has one expense ratio plus brokerage; a fund of funds has its own expense ratio on top of the ETF’s.
- SIP: easy in a fund of funds; with an ETF, through a broker’s SIP feature if it has one.
- Tax: gains on an ETF held more than 12 months are long-term; a fund of funds needs more than 24 months.
- Right now: most funds of funds have paused new money; ETFs still trade on the exchange.
How gold ETFs and gold funds are taxed
Gold funds are neither equity-oriented funds nor “specified mutual funds” (which hold more than 65% in debt) under the Income-tax Act, 2025, so neither the equity rates nor the slab-rate rule for debt funds applies. Section 2(101) sets the holding period for long-term gains:
- Gold ETF: a listed security, so gains on units held more than 12 months are long-term and taxed at 12.5% (section 197), with no indexation and no ₹1.25 lakh exemption. Gains on units held 12 months or less are taxed at your slab rate.
- Gold fund of funds: not listed, so it needs more than 24 months for long-term gains, taxed at 12.5%. Gains on units held 24 months or less are taxed at your slab rate.
Surcharge, where it applies, and 4% cess come on top. Tax rules change; check your own case with a tax adviser.
Tracking error and tracking difference
A gold ETF tries to match the domestic price of gold. Two measures show how closely it does, and both are published on AMFI’s website:
- Tracking difference: the gap between the ETF’s return and its benchmark’s over a period, such as one year. It is usually a little negative, roughly the fund’s costs. Closer to zero is better.
- Tracking error: how much the daily gap varies, as an annualised percentage. SEBI caps it at 2%. Lower is steadier.
For a passive fund that holds the same metal as every other, these two numbers and the expense ratio are what separate one gold ETF from another.
Risks to know
- Gold price: gold can fall for long periods. Its price in rupees also moves with the rupee-dollar exchange rate.
- Premium or discount: when demand is high an ETF can trade above the value of its gold, and buyers pay more than it is worth; the reverse can happen in a sell-off.
- Liquidity: small ETFs can trade thinly, with wider gaps between buying and selling prices.
- Access: as in October 2026, fund houses can pause new investment in a fund of funds.
Is there a best gold ETF?
Not in the sense of one that will do better: every gold ETF holds the same gold, so their returns before costs are almost identical. They differ in cost and in how well they track the price, so compare these instead:
- Tracking difference over a year: the closest to zero has lost the least to costs and tracking.
- Expense ratio: for a fund of funds, add the ETF’s expense ratio to its own.
- Size and trading volume: a larger, actively traded ETF is easier to buy and sell near its value.
- Account and tax: a fund of funds avoids a demat account; an ETF gives long-term tax treatment after 12 months instead of 24.
This is general information, not a recommendation of any fund. How much gold suits you depends on the rest of your portfolio.
Questions people ask
On 15 October 2026, most fund houses running gold funds of funds paused new lump sums, switch-ins and new SIP registrations from 16 October, until further notice. Existing SIPs and redemptions continue. The notices give no reason; Reuters reported, citing industry sources, that the move followed discussions with SEBI, which had not commented.
Yes. The October 2026 notices cover gold funds of funds, not gold ETFs, whose units still trade on the NSE and BSE. You need a demat and trading account to buy them.
A gold ETF holds physical gold and trades on the stock exchange, so it needs a demat account. A gold fund of funds invests in a gold ETF and is bought from the fund house at the day’s NAV, with SIPs available, but it adds its own expense ratio and needs 24 months, not 12, for long-term tax treatment.
Under the Income-tax Act, 2025, gains on gold ETF units held more than 12 months are long-term and taxed at 12.5% without indexation; gains on units held 12 months or less are taxed at your slab rate. For a gold fund of funds, the long-term period is more than 24 months.
There is no best gold ETF in the sense of better returns: all hold the same gold. Compare tracking difference (the median ETF lagged its benchmark by 1.19% over the past year), expense ratio, and size and trading volume. This page does not recommend any fund.
Over the year to 15 October 2026, gold ETFs returned between 14.04% and 15.75%, with a median of 14.30%. Their returns follow the domestic price of gold, less costs; past returns do not tell you future ones.
Related
This page is educational research based on AMFI data, SEBI’s rules and fund house notices. It is not a recommendation to invest in any scheme, or personalised investment advice. Mutual fund investments are subject to market risks; read all scheme related documents carefully. Past returns do not guarantee future returns. Registration granted by SEBI, enlistment with IAASB and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors.