SEBI's New Gold & Silver ETF Valuation Rules: What Changes from April 1, 2026?

If you hold Gold or Silver ETFs, there's a regulatory update that directly affects how the daily value of your investment is calculated. SEBI has revised the valuation framework for physical gold and silver held by mutual fund schemes, mandating the use of exchange-published polled spot prices instead of international benchmarks. The change came into effect from April 1, 2026 — and while it may sound technical, the practical impact is fairly straightforward.

What Was the Old System?

Until March 31, 2026, the NAV of Gold and Silver ETFs was calculated using a rather layered process. Fund houses in India used the AM fixing price published by the London Bullion Market Association (LBMA) as their starting point. Since this price is in US dollars and reflects international market conditions, several adjustments were needed before it could be used as an Indian valuation. These adjustments included currency conversion, customs duty, transportation costs, applicable taxes and levies, and even a notional premium or discount — all applied differently across asset management companies.

This meant two fund houses holding identical quantities of gold could arrive at slightly different NAVs simply because of how each applied these adjustments. That inconsistency wasn't ideal for investors trying to compare schemes.

What Changes Now?

Under the new framework, mutual funds must use polled spot prices published by recognised Indian stock exchanges such as the Multi Commodity Exchange of India (MCX). These prices are derived from actual domestic market trades and physically settled contracts, making them more reflective of Indian supply-demand dynamics.

In simpler terms: the NAV of your Gold or Silver ETF will now be anchored to the same prices used for settling gold and silver derivative contracts on Indian exchanges — prices that already factor in domestic import duties, taxes, and market realities. Manual adjustments are significantly reduced, and valuation variation across fund houses is eliminated.

 Old vs New: A Quick Comparison

 Why Did SEBI Make This Change?

SEBI said the move has been taken to protect investor interests, promote the development of the securities market, and regulate valuation practices more effectively. The regulator also pointed out that since domestic exchanges operate under strict transparency and compliance requirements, their published prices are a more accountable and uniform source for valuation.

The decision followed deliberations in the Mutual Fund Advisory Committee and a stakeholder consultation process — meaning this wasn't a rushed change. It was a considered policy shift aligned with the newly notified SEBI (Mutual Funds) Regulations, 2026.

What Does This Mean for You as an Investor?

For existing holders of Gold or Silver ETFs, there is nothing to do. Your units remain the same, the underlying metal holdings remain the same. What changes is the methodology used to price those holdings daily.

If you are comparing two Gold ETFs from different fund houses, the difference in NAV will now reflect actual differences in the fund's holdings, costs, or efficiency — not differences in how each fund house applied the earlier LBMA-based calculation. This makes it meaningfully easier to compare schemes and evaluate tracking efficiency.

AMFI, in consultation with SEBI, will prescribe a uniform implementation policy ensuring all AMCs adopt the same valuation methodology — which eliminates one more variable from the comparison equation for investors.

The Bigger Picture

Gold ETF inflows more than doubled in January 2026 compared to December 2025, reaching ₹24,039 crore, while Silver ETFs recorded a net inflow of ₹9,463 crore in the same period. With investor interest in bullion-backed funds at record levels, getting the valuation framework right is not a minor administrative exercise. A domestic pricing anchor adds a layer of reliability to an already fast-growing segment of the mutual fund industry.

 Regulatory Reference

Circular Title: Valuation of Physical Gold and Silver Held by Mutual Fund Schemes

Circular No.: HO/(68)2026-IMD-POD-2/I/5780/2026

Issued by: Securities and Exchange Board of India (SEBI)

Date: February 26, 2026

Effective Date: April 1, 2026

Official Link: https://www.sebi.gov.in/legal/circulars/feb-2026/valuation-of-physical-gold-and-silver-held-by-mutual-fund-schemes_100001.html

Disclaimer: This article is for informational purposes only and does not constitute investment advice. Mutual fund investments are subject to market risks. Please read all scheme-related documents carefully before investing.