Overall, other passive schemes, which include gold and silver ETFs, FoFs, and index funds, saw monthly inflows fall 65% to ₹13,879 crore from ₹39,954 crore in January.
The decline in gold ETF inflows follows January’s exceptional surge, which was driven by start-of-year portfolio allocations and rebalancing, as well as some profit-booking by investors. Silver ETFs, meanwhile, saw both outflows and a degrowth in assets under management on a month-on-month basis.
Nehal Meshram, Senior Analyst – Manager Research at Morningstar Investment Research India, said that despite the moderation, gold and silver ETFs remain popular due to their liquidity, transparency, and portfolio diversification benefits.
Investors are using these products not just for tactical exposure, but as a strategic allocation to hedge against market and geopolitical risks.
Santosh Joseph, Founder and Partner at Germinate Investor Services LLP, added that multi-asset funds are complementing this trend by offering dynamic or static allocation to gold and silver, along with hedging and currency exposure benefits.
“Investors are beginning to realise the unmissable potential of these funds in building balanced portfolios,” he said.
Vaibhav Chugh, CEO of Abakkus Mutual Fund, said, “The flows in gold ETFs reflect that investors want to simultaneously hedge portfolios. However, after massive January inflows, it appears that some money is rotating back to equities because of equity price corrections.”
Nitin Agrawal, CEO of Mutual Funds at InCred Money, added that the moderation in gold ETF inflows suggests that some defensive positioning is unwinding, with equity regaining appeal as the preferred vehicle for long-term wealth creation.
Rohit Sarin, Co-Founder of Client Associates, said, “Gold ETFs garnering over ₹5,254 crore in net inflows signals continued confidence in gold amid lingering global uncertainty.”
Feroze Azeez, Joint CEO of Anand Rathi Wealth Limited, noted, “Investors are maintaining meaningful exposure to equities while gradually diversifying across asset classes in response to evolving market conditions.”
ALSO READ | Equity mutual fund inflows rise 8% in February; total AUM crosses ₹82 lakh crore