Gold and Silver held by Gold and Silver Exchange Traded Funds (ETFs) will see a change in the way they are valued by the fund houses. From April 01, 2026, the mutual funds will value physical Gold and Silver by using the polled spot prices published by the recognized stock exchanges, which are used for settlement of physically delivered Gold and Silver derivatives contracts.

The Multi-Commodity Exchange of India Limited (MCX), India’s first listed exchange, publishes daily price data of gold, silver and other commodities.

Currently, physical Gold and Silver held by Gold and Silver Exchange Traded Funds (ETFs) are valued at AM fixing prices of the London Bullion Market Association (LBMA).

The final valuation is arrived at after adjusting the LBMA prices with necessary metric and currency conversions, addition of transportation costs, customs duty, applicable taxes and levies and factoring in notional premium or discount to arrive at domestic valuations.

Now, it has been decided that the polled spot prices published by recognized stock exchanges may be used for the valuation of Gold and Silver held by mutual fund schemes.

As stock exchanges are subject to transparency and compliance requirements under the regulatory framework, using the spot price published by such regulated entities shall lead to valuation reflective of domestic market conditions and also ensure uniformity in the valuation practices.

SEBI notified the SEBI (Mutual Funds) Regulations, 2026 on January 14, 2026, to take effect from April 1, 2026. As a result, it has been decided that beginning April 1, 2026, mutual funds will value genuine gold and silver using Spot prices reported by recognized stock exchanges are utilized to settle physical gold and silver futures contracts.

The spot polling mechanism shall comply with the spot polling guidelines as specified by SEBI from time to time. AMFI in consultation with SEBI, will prescribe a uniform policy in this regard.

Earlier in the month, a Consultation Paper that proposes changes to the regulations concerning base price and price bands, including those for gold and silver ETFs, was floated by the Securities and Exchange Board of India (SEBI) to review the price band framework for Exchange Traded Funds (ETFs).

SEBI proposed that there will be an initial price band of ±6%, which may be flexed up to ±20% during the trading day, subject to a cooling-off period.

After exhausting the initial price band, there will be a cooling-off period of 15 minutes, and the price band will be flexed by 3%.

In case the price movement in the international markets is more than the aggregate Daily Price Limit (DPL) of 9%, the same may be further relaxed in stages of 3% by the Exchange, with a cooling-off period of 15 minutes.

The single-day maximum variation of ±20% would be applicable. Essentially, the cooling-off period is the new big proposal that will help manage the intra-day volatility.