New rule for gold, silver ETFs: What changes from 1 April 2026

The Securities and Exchange Board of India (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 for determining their value.

The new norms will replace the existing benchmark-linked approach and are aimed at bringing uniformity and ensuring valuations reflect domestic market conditions.

What the new rule says

In a circular issued on Thursday, February 26, the market regulator said: “It has been decided that with effect from April 01, 2026… the mutual funds shall value physical Gold and Silver by using the polled spot prices published by the recognised stock exchanges which are used for settlement of physically delivered Gold and Silver derivatives contracts.”

Sebi added that the spot polling mechanism must comply with the spot polling guidelines specified by the regulator from time to time.

The decision follows discussions in the Mutual Fund Advisory Committee and public consultation with stakeholders.

Shift from LBMA-based pricing

At present, physical gold and silver held by Exchange Traded Funds (ETFs) are valued based on the AM fixing prices of the London Bullion Market Association (LBMA).

Under the existing system, LBMA prices are adjusted through metric and currency conversions and the addition of transportation costs, customs duty, applicable taxes and levies. A notional premium or discount is also factored in to arrive at domestic valuations.

When will the new rule come into effect?

The revised valuation norms will take effect from April 1, 2026.

The change aligns with the coming into force of the SEBI (Mutual Funds) Regulations, 2026, which were notified earlier this year.

What the SEBI change means for gold and silver ETF investors

The new SEBI norms mean that gold and silver ETFs will now be valued using domestic exchange spot prices instead of international benchmarks.

For investors, this brings greater transparency and uniformity in Net Asset Value (NAV) calculations, making it easier to compare schemes.

A uniform spot-based valuation mechanism could reduce such discrepancies and enhance comparability for investors.

Implementation framework

The Association of Mutual Funds in India (Amfi), in consultation with Sebi, will prescribe a uniform policy for implementation of the revised valuation mechanism.

Disclaimer: This article is written purely for informational purposes and should not be considered investment advice from Upstox. Investors should do their own research or consult a registered financial advisor before making investment decisions.