Foreign rates will no longer apply! Gold and silver mutual funds will now be valued at domestic spot prices, a new rule effective April 1st..

SEBI has changed the valuation rules for gold and silver mutual funds. The price of physical gold and silver will now be determined using the polled spot prices published on stock exchanges. This change will come into effect from April 1, 2026.

Previously, gold and silver ETFs used to value their holdings based on the London Bullion Market Association's (LBMA) AM fixing price.

The domestic price was arrived at by adding dollar-to-rupee conversion, transportation costs, customs duties, taxes, and other charges. However, this method will now be discontinued.

What will be special about the new rule?

According to the new rule, mutual funds will now use the spot prices used for settlement of gold and silver derivative contracts with physical delivery on recognized stock exchanges in India (such as MCX or NSE).

This will make valuations more transparent, uniform, and reflect the true state of the domestic market. This decision is aligned with the SEBI (Mutual Fund) Regulations 2026. Its purpose is to provide better and more accurate information to investors.

AMFI to formulate policy in collaboration with SEBI

The mutual fund industry body AMFI (Association of Mutual Funds in India) will work with SEBI to formulate a uniform policy to implement this new approach.

Ordinary investors investing in gold and silver ETFs will now see more reliable NAV (Net Asset Value), as prices will now be based on the local market. This could make investing in gold and silver mutual funds more attractive, especially in times of inflation or uncertainty.

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