Retail investors can play on as AMCs cap gold bets
Wealth managers believe retail investors in gold mutual fund schemes will not be affected, after three large asset management companies announced restrictions on purchase of
Wealth managers believe retail investors in gold mutual fund schemes will not be affected, after three large asset management companies announced restrictions on purchase of large quantities of gold by investors.Three AMCs namely HDFC MF, ICICI Prudential MF and Nippon Life India AMC have announced temporary restrictions on their gold schemes. All three AMCs announced subscription transactions of large investors who directly transact with them and invest a minimum of 25 crore will not be accepted. In addition, in the case of both HDFC Gold ETF FoF and Nippon India Gold Savings Fund, lump sum purchases will be restricted to a limit of 10 lakh per month.
Also for Nippon India Gold Savings Fund, SIPs or STPs will continue with a limit of 50,000 per investor per day.“Restrictions will apply only to large investors, while AMCs will continue to create units for market makers, without any restrictions,” said a ETF head at a domestic fund house. As units are created, there will be enough liquidity available to investors who can buy and sell these units at prevailing market prices.Wealth managers believe the current move by fund houses is in line with the prime minister's message to reduce overall imports.“This is an attempt to slow down purchase of gold and reduce pressure in imports, after the strong inflows into the yellow metal over the last one year,” says Saket Kumar, Co-Founder, ETF Junction.Gold has been one of the best performing assets in recent times, and saw a sharp run up returning 56.08% in the last one year, while over a three year period it returned an annualized 35.89%.
However over the last three months it lost 3.59%.“With prices stabilizing over the last three months, there is no longer a frenzy to buy gold. Most investors now allocate 5-10% to the yellow metal in line with their asset allocation largely through SIPs,”
says Nikhil Gupta, Founder, Sage Capital.Gold ETFs saw net sales of 71,914 crore in the last 12 months and mutual funds now managed gold assets worth 1.78 lakh crore as of April 30, 2026, a rise of 290% in the last 1 year.
The BriefWire