Indian mutual fund investors redeemed more gold ETF units than they bought in May 2026, with the category posting a net outflow of ₹725.04 crore during the month, according to data released by the Association of Mutual Funds in India.
Total inflows into Gold ETFs stood at ₹2,604.73 crore while redemptions came in at ₹3,329.77 crore. Assets under management in the category stood at ₹1,84,570.85 crore as of May 31.
Gold prices were up. But Indian mutual fund investors were selling. Here’s why.
Gold has been among the strongest-performing asset classes globally over the past year, driven by geopolitical uncertainty, central bank buying, and a weakening dollar.
For investors who entered Gold ETFs during the rally, May appears to have been an exit window — a classic case of profit-booking near perceived highs rather than a loss of faith in the metal.
Equity pulling money away
Equity-oriented schemes told a sharply different story in May. The category recorded net inflows of ₹22,907.77 crore for the month. Small cap funds drew ₹4,945.57 crore, flexi cap funds attracted ₹5,175.54 crore, and mid cap funds pulled in ₹4,385.06 crore.
With domestic markets recovering, investors appear to be rotating out of defensive assets like gold and back into equities.
Broader market picture
The overall mutual fund industry recorded a net outflow of ₹64,021.17 crore in May, driven almost entirely by debt schemes, which saw institutional redemptions of ₹96,948.51 crore — a seasonal pattern tied to quarter-end liquidity needs. Equity and hybrid schemes absorbed much of this, with hybrid funds posting net inflows of ₹10,560.24 crore.
Multi asset allocation funds were a standout, drawing ₹3,928.51 crore in net inflows. Total assets under management across the industry stood at ₹81,58,341.65 crore as of May 31, 2026. Thirteen new schemes completed allotment during the month, including 12 passive index and ETF products.
