Gold FoF curbs introduced by several Indian mutual fund houses since mid-October 2026 have temporarily limited fresh investments in some gold fund-of-funds schemes. The restrictions differ by scheme and can cover lump-sum purchases, new systematic investment plans and switch-ins.

Key Takeaways

  • The available information does not establish whether existing SIPs can continue across affected schemes.
  • Gold ETFs offer direct exchange-traded exposure but require a demat and trading account.

What the Gold FoF curbs mean for investors

Investors should check the notice for their particular scheme to determine which transactions are affected and whether an existing systematic investment plan, or SIP, can continue. The fund houses have not disclosed specific reasons for the restrictions.

Industry participants believe strong inflows and concern about rising gold imports may be factors, but that explanation has not been confirmed by the fund houses.

How gold ETFs differ from funds of funds

A gold fund of funds invests in gold ETFs rather than directly in physical gold. Tata Mutual Fund’s explanation of gold ETF investment routes describes how the underlying ETFs hold physical gold and how investors can use a fund of funds without a demat account.

Direct gold ETFs trade on stock exchanges during market hours, while fund-of-funds purchases and redemptions generally use the day’s net asset value. ETFs typically have lower costs because a fund of funds also has its own expenses. Some ETFs may have limited liquidity or trade at a premium to net asset value.

The restrictions on several gold funds of funds do not apply to their ETFs. Some brokers offer recurring ETF purchases, although these differ from a mutual fund SIP.

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