Gold ETF on WebNotes

Gold ETF in India

Tue, 12 May 2026 00:00:00 +0000

A Gold ETF (Gold Exchange-Traded Fund) in India is an open-ended fund that is listed and traded on a stock exchange, where each unit represents ownership of a defined quantity of physical gold (typically 0.01 gram or 1 gram of gold of 99.5% or 99.9% purity). The fund’s assets are invested in physical gold held in a custodian-approved vault, and the NAV of each unit tracks the domestic gold price. SEBI regulates gold ETFs under the SEBI (Mutual Funds) Regulations, 1996, and has issued specific guidelines on gold ETF structure, custodianship, and audit requirements.

Gold ETF vs Sovereign Gold Bond vs Gold mutual fund

Tue, 12 May 2026 00:00:00 +0000

India offers three regulated paper-gold investment instruments: Gold ETFs (exchange-traded funds backed by physical gold), Sovereign Gold Bonds (SGBs) (government-issued bonds denominated in grams of gold), and Gold Mutual Funds (fund-of-fund schemes investing in gold ETFs). Each tracks the domestic price of 24-carat gold but differs in structure, cost, taxation, and liquidity.

Physical gold (jewellery, coins, bars) is excluded from this comparison.

Instrument overview

Gold ETF

A Gold ETF is an exchange-traded fund that holds physical gold (minimum 99.5% purity) as the underlying asset. Each unit of a Gold ETF typically represents 1 gram (or 0.01 gram for some fund-specific units) of gold. Gold ETFs are SEBI-regulated mutual fund schemes listed on NSE and BSE. A demat account is required. AMFI-registered AMCs offering Gold ETFs include Nippon India, HDFC, SBI, Axis, Kotak, UTI, and ICICI Prudential, among others.

Taxation of gold ETFs and silver ETFs in India

Tue, 12 May 2026 00:00:00 +0000

Taxation of gold ETFs and silver ETFs in India is governed by the same framework as other “specified mutual funds” introduced by the Finance Act 2023. Gold ETFs hold physical gold (or gold-backed instruments); silver ETFs hold physical silver. Neither holds domestic equity, so both fail the 65% equity test and are classified as specified mutual funds. For units acquired on or after 1 April 2023, all capital gains are treated as short-term regardless of holding period and taxed at the investor’s income-tax slab rate. For units acquired before 1 April 2023, gains on units held for more than 36 months are LTCG at 20% with indexation under Section 112.

ETF investing on Zerodha

Mon, 11 May 2026 00:00:00 +0000

Exchange-Traded Funds (ETFs) are open-ended mutual fund schemes that are listed and traded on stock exchanges in real time, similar to equity shares. Unlike traditional mutual funds where units are bought and sold at end-of-day NAV, ETFs have a continuously updating market price during trading hours. Zerodha provides full access to all ETFs listed on the National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) through Kite. ETF investing through Zerodha carries zero brokerage for delivery (CNC) orders, making it cost-effective for long-term investors.