What Happened
- For the first time in India's mutual fund history, net inflows into Gold ETFs (Rs 24,040 crore) surpassed equity mutual fund inflows (Rs 24,029 crore) in January 2026, according to AMFI (Association of Mutual Funds in India) data released on 10 February 2026.
- Gold ETF inflows surged 106.4% month-on-month, rising from Rs 11,647 crore in December 2025 to Rs 24,040 crore in January 2026 — the highest-ever monthly inflow for the category.
- Equity mutual fund inflows, meanwhile, declined 14.35% month-on-month, reflecting investor caution amid market volatility driven by US tariff uncertainty and global geopolitical tensions.
- Gold prices have approximately doubled in dollar terms since January 2024, while Indian equity markets delivered muted returns in recent months, prompting a significant shift in investor asset allocation.
Static Topic Bridges
Gold Exchange-Traded Funds (ETFs) — Structure and Regulation
A Gold ETF is an open-ended mutual fund scheme that invests in physical gold of 99.5% purity (or higher) and issues units representing the gold held. Each unit of a Gold ETF typically represents 1 gram of gold. Gold ETFs are listed and traded on stock exchanges (NSE and BSE) like ordinary shares, allowing investors to gain exposure to gold price movements without physically holding the metal. They are regulated by SEBI under the SEBI (Mutual Funds) Regulations, 1996.
- Underlying asset: Physical gold of 99.5% purity, stored in SEBI-approved secure vaults with custodian oversight
- Unit value: Each unit represents approximately 1 gram of gold; "Creation Unit" size is typically 1 kg (for institutional redemption in physical gold)
- Regulation: SEBI (Mutual Funds) Regulations, 1996 — covers NAV computation, expense ratio limits, custodian requirements, and mandatory audits of physical gold holdings
- Taxation (post-2024): Gains from Gold ETFs held over 12 months taxed at 12.5% (long-term capital gains); below 12 months taxed at applicable income tax slab rate
- Gold ETFs vs Sovereign Gold Bonds (SGBs): SGBs are issued by RBI on behalf of the Government of India, offer 2.5% annual interest, and are tax-free on maturity if held for 8 years; Gold ETFs offer no interest but provide liquidity through stock exchange trading
Connection to this news: The record inflows demonstrate Gold ETFs' growing acceptance as a mainstream investment vehicle in India. Unlike physical gold (subject to making charges, purity concerns, and storage costs), Gold ETFs offer a transparent, regulated, and cost-efficient way to invest in gold, regulated by SEBI with mandatory custodial audits.
Association of Mutual Funds in India (AMFI) and India's Mutual Fund Industry
AMFI is the industry body and self-regulatory organisation for the mutual fund industry in India. Established in 1995, it represents all SEBI-registered Asset Management Companies (AMCs). AMFI releases monthly data on mutual fund inflows, AUM (Assets Under Management), and scheme categorisation, which serves as the authoritative source for tracking investment trends in India's mutual fund ecosystem.
- Established: 22 August 1995
- Status: Registered under Section 25 of the Companies Act, 1956 (not-for-profit); functions as the self-regulatory body under SEBI oversight
- Total mutual fund AUM (January 2026): Rs 81,01,306 crore (approximately USD 940 billion)
- Total mutual fund industry net inflows (January 2026): Rs 1,56,459 crore
- Number of SEBI-registered AMCs: 44 (as of 2026)
- Key categories of mutual fund schemes (per SEBI circular of October 2017): Equity, Debt, Hybrid, Solution-oriented, and Other (including ETFs)
- Unique mutual fund investors in India: approximately 5 crore (50 million) folios
Connection to this news: AMFI's January 2026 data showing Gold ETFs surpassing equity funds is a landmark data point because AMFI's standardised reporting allows precise comparison across fund categories, making this "first-ever" milestone both measurable and historically significant.
Gold as a Safe Haven and Macroeconomic Indicators
Gold functions as a "safe haven" asset — one that retains or increases value during periods of market stress, geopolitical uncertainty, or currency depreciation. Its price typically moves inversely to equity markets and the US dollar. Central banks, including the Reserve Bank of India (RBI), hold gold as part of their foreign exchange reserves to diversify risk. India is the world's second-largest consumer of gold (after China), with annual demand of approximately 700-800 tonnes.
- Gold price trajectory: approximately doubled in USD terms between January 2024 and January 2026, reaching record highs above USD 2,800/oz
- RBI gold reserves: 876.18 tonnes as of December 2025, constituting approximately 11% of India's total foreign exchange reserves; RBI has been a net purchaser of gold since 2017
- India's gold import bill: approximately USD 45-50 billion annually, making gold the second-largest import item after crude oil
- Gold's role in Indian economy: culturally significant (jewellery accounts for ~60% of demand); Sovereign Gold Bond Scheme (launched 2015) and Gold Monetisation Scheme (launched 2015) aimed at reducing physical gold imports
- RBI's Gold Monetisation Scheme: Allows individuals and institutions to deposit physical gold with banks and earn interest (2.25-2.5% p.a.)
Connection to this news: The surge in Gold ETF inflows reflects the macroeconomic environment of January 2026 — US tariff uncertainty (India-US deal was still being finalised), equity market volatility, and gold's sustained rally — driving Indian retail investors to allocate more towards gold as a hedge, reversing the historical dominance of equity fund inflows.
Key Facts & Data
- Gold ETF net inflows (January 2026): Rs 24,040 crore — highest-ever monthly inflow, surpassing equity MF inflows for the first time
- Equity MF net inflows (January 2026): Rs 24,029 crore — a 14.35% month-on-month decline
- Gold ETF MoM growth: 106.4% (from Rs 11,647 crore in December 2025)
- Total mutual fund industry AUM (January 2026): Rs 81,01,306 crore
- Total industry net inflows (January 2026): Rs 1,56,459 crore
- Gold price: approximately doubled in USD terms since January 2024
- RBI gold reserves: 876.18 tonnes (approximately 11% of total forex reserves, as of December 2025)
- Gold and silver ETFs combined: Rs 33,503 crore inflows in January 2026