India’s equity investors are flocking to gold exchange-traded funds (ETFs) as a hedge against stock market volatility amid global headwinds.
Gold ETFs saw record monthly net inflows of 11,646.74 crore in December, surpassing inflows into flexi-cap funds, which received 10,019.27 crore, showed data from the Association of Mutual Funds in India (Amfi). Flexi-cap funds are open-ended equity mutual funds that invest across large-, mid-, and small-cap companies.
Earlier, in September also, gold ETFs touched record inflows of Rs 8,363 crore. In 2025, gold ETFs received net inflows of 42,961 crore, the highest since 2001, when data was last available.
Gold ETFs have recorded their highest-ever inflows; however, the shift has not come at the cost of equity commitment. Overall, the data reflects a more mature investor mindset that responds to volatility with balance, uses corrections constructively, and stays focused on long-term wealth creation, said Feroze Azeez, joint chief executive of Anand Rathi Wealth Ltd.
In demand
The metal’s returns have outpaced those of equity over a one- to five-year horizon amid global tariff tensions, a falling dollar, and recent geopolitical developments, such as the US takeover of Venezuela, which have boosted the appeal of the yellow metal.
For instance, the highly popular Nippon India ETF Gold BeES, priced at 113.5 per unit, has delivered a 73.52% return over the past year, compared with the Nifty 50’s 9.38% return, with the index trading at 25,716 at the time of writing.
Amid the precious metals rally, commodity expert Jim Rogers told mint in December that he expects returns to moderate in 2026. “I own both gold and silver and am not selling, but I doubt if they will have two years in a row like that,” he said. Nippon India Silver ETF, meanwhile, returned 162% at 228.34 a unit during the same period.
Every asset class moves in cycles, gold and silver are no exception, which is why a degree of caution is warranted against aggressively chasing prices at current levels, said Sirshendu Basu, head of products at Bandhan AMC Ltd.
“That said, both gold and silver remain important from an asset allocation perspective, and one can consider allocating around 15-20% of a portfolio. Gold, in particular, serves multiple purposes—it acts as a hedge against inflation and provides currency diversification since it is largely dollar-denominated, making portfolios that are otherwise INR-heavy more robust,” he said.
Meanwhile, total monthly net inflows into equity mutual funds fell slightly to 28,034 crore in December, compared with 29,893 crore in November, highlighting the growing investor preference for gold amid uncertainty.
