Mumbai, Maharashtra (UNA) :
Gold exchange-traded funds (ETFs), which allow investors to gain exposure to bullion without owning physical gold, saw unprecedented inflows of about $1.25 billion in December. This marked the strongest monthly demand for Indian gold ETFs since their inception, reflecting heightened investor interest in precious metals during a period of broader market uncertainty.
For ordinary savers and small investors, rising subscription to gold ETFs indicates a shift toward conservative assets. Many investors view gold as a hedge against inflation and stock market volatility, choosing gold-linked funds to balance risk within existing portfolios.
The record inflows also suggest that investors are increasingly comfortable with digital and paper gold formats, which offer easier access and liquidity compared with physical gold. Gold ETFs trade on stock exchanges, enabling buyers and sellers to transact like any other share, while holding units backed by bullion.
Market analysts said that inflows were likely supported by a combination of global cues, including fluctuating equity markets and concerns about interest rates. While returns in equity and debt markets vary with economic conditions, gold’s stability often attracts interest when uncertainty rises.
For everyday investors, understanding that gold ETFs can be part of a long-term diversification strategy may help manage risk. Financial advisers recommend assessing personal goals and risk tolerance before making investment choices, as all asset classes carry potential upsides and downsides.