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Explained: Why are gold and silver ETFs falling today?
4 min read | Updated on January 22, 2026, 13:26 IST
SUMMARY
Gold and Silver ETF prices are falling after posting a sharp rally on Wednesday. The sharp fall in prices once again showed how the ETF pricing mechanism can sometimes become a costly affair for investors.
ETFs are exchange traded funds and replicate the returns of the underlying asset. Image: Shutterstock.
Gold and Silver ETFs are back in focus, not for positive reason, but for its pricing mechanism. Majority of the Gold and Silver ETFs are trading in sharp discount to previous day’s closing price. This was partially due to a pullback in global prices and partially due to ETFs pricing and market dynamics. Let us see why.
Why are gold and silver prices falling?
After a softened tone by President Trump on Greenland and Europe, gold and silver prices witnessed a pullback from record high levels. The gold prices were down to $4,740 per ounce from $4,888 on Wednesday, and Silver prices fell to $92 per ounce after hitting $95 per ounce the previous day. However, there is mayhem in the ETF market as gold and silver ETFs are crashing 10-15% across the board or at the fund house level.
Investors who invested in gold and silver ETFs on Wednesday are now sitting on losses in the range of 10-15% despite gold and silver prices falling by mere 1-2%. If you are one of those investors, here is all you need to know on why Gold and Silver ETFs are crashing on Thursday.
| Silver ETFs | Previous day close | iNAV | 22nd Jan low | Difference to iNav |
|---|---|---|---|---|
| Silverbees (Nippon AMC) | ₹310.4 | ₹283 | ₹249 | -12% |
| SilverIETF (ICICI Pru AMC) | ₹322 | ₹295 | ₹261 | -11.5% |
| Axisilver (Axis Mutual Fund) | ₹320 | ₹306 | ₹252 | -17.6% |
| Silvercase (Zerodha Fund) | ₹32.8 | ₹31.5 | ₹26 | -16% |
| Silver1 (Kotak AMC) | ₹304 | ₹279 | ₹242 | -13.2% |
The majority of the silver ETFs fell in the range of 12-15% on Thursday morning after Trump announced on not impose new tariffs on EU nations and ruled out military action on Greenland. This led to riskon environment in the global market as investors cut their positions in the safe havens like Gold and Silver and moved back to equities. While this happened in global markets, the ETF markets witnessed strong supply of units after witnessing sharp declines in global prices of gold and silver. Which led to premium erosion in ETFs and subsequent fall in prices close the NAVs.
| Gold ETF | Previous day close | iNAV | 22nd Jan low | Difference to iNAV |
|---|---|---|---|---|
| Axisgold (Axis Mutual Fund) | ₹147 | ₹134 | ₹119 | -11.1% |
| Tatagold (Tata AMC) | ₹16 | ₹15.2 | ₹14 | -7.8% |
| Goldbees (Nippon AMC) | ₹134.9 | ₹127 | ₹119 | -6.2% |
| HDFCgold (HDFC AMC) | ₹139.5 | ₹131 | ₹121 | -7.6% |
| Goldcase (Zerodha AMC) | ₹25.6 | ₹24.1 | ₹22 | -8.2% |
Similar market rout was witnessed in gold ETFs as well after gold prices fell a little over 2% on Thursday morning, the gold ETF prices crashed by 10%.
Here is why the ETFs prices are falling
ETF units are purchased by fund houses after keeping aside physical gold and silver with the exchange. When there is supply shortage with the fund house to deliver to exchange, it creates a supply shortage of ETF units.
If the supply is limited and the demand for ETF units is high, the ETFs trade at a premium due to natural supply constraints. However, when supply is back to normal levels, the ETF prices adjust to their iNAV ( indicative net asset value). Consequently, we are witnessing a sharp crash in the ETFs today as compared to the underlying asset, and prices are now trading near their iNAVs.
If you are a newbie investor and looking to invest in gold and silver ETFs for participating in the rally, make sure to check the ETF prices and iNAV of the ETF so as to avoid getting trapped in premium prices
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