By Vineet Kumar 
Gold Exchange Traded Funds (ETFs) have gained global traction as a preferred investment tool for those looking to invest in the precious metal without physical ownership. According to recent data from the World Gold Council, gold holdings by Indian gold ETFs reached a historic high of 54.5 tonnes by October 31, 2024, doubling from the 27.4 tonnes recorded four years ago. This growth aligns with increasing geopolitical tensions, changes in central bank policies, and market volatility, all of which appear to have intensified interest in gold.
Both individual and institutional investors have significantly contributed to these inflows. AMFI (Association of Mutual Funds in India) reported that domestic gold ETFs accumulated Rs 12,448 crore over the past 21 months, excluding just two months. Gold ETFs, which are passively managed, invest in gold bullion with 99.5% purity and closely mirror gold’s domestic price. They can be bought and sold on stock exchanges, requiring a demat account.
Over the last 15 years, gold ETFs in India have seen periods of high inflows, particularly in 2011, 2020, and 2024, with net additions of around 17, 14, and 12 tonnes, respectively. According to Tapan Patel, commodities fund manager at
Tata.
