Gold Mutual Funds in India 2025: Returns, Benefits & Risks
The price of 24-karat gold was ₹29,600 per 10 grams in 2013, and as of 17th September 2025, it stands at ₹1,12,920 per 10 grams. This marks an approximately 281% gain over the last 12 years, which shows the growing demand for gold. A decade ago, the primary way to invest in gold was through physical gold.
However, today, investors have several alternatives to invest in gold. Among these, gold mutual funds have become one of the most popular options. These funds offer a simple and convenient way for investors to gain exposure to gold without the need to buy or store physical gold. Let’s explore the top 10 gold mutual funds in India along with their past performance.
Top Gold Mutual Funds in India
Here is the list of the top gold mutual funds in India sorted based on their 5-year CAGR.
| Name | AUM (Rs. in cr.) | CAGR 5Y(% | CAGR 3Y(%) | Expense Ratio(%) | NAV (₹ per unit) | Exit Load(%) | Volatility(%) |
|---|---|---|---|---|---|---|---|
| LIC MF Gold ETF FoF | 253.72 | 15.49 | 29.36 | 0.32 | 30.03 | 1 | 21.85 |
| Axis Gold Fund | 1272.23 | 15.35 | 28.89 | 0.17 | 34.75 | 1 | 15.01 |
| SBI Gold | 5220.86 | 15.35 | 29.29 | 0.1 | 33.67 | 1 | 14.49 |
| Aditya Birla SL Gold Fund | 663.39 | 15.28 | 29.12 | 0.2 | 33.21 | 1 | 16.16 |
| ICICI Pru Regular Gold Savings Fund | 2602.8 | 15.28 | 29.22 | 0.09 | 35.29 | 1 | 15.07 |
| Quantum Gold Saving Fund | 244 | 15.17 | 29.31 | 0.03 | 42.16 | 0 | 14.77 |
| HDFC Gold ETF FoF | 4914.73 | 15.15 | 29.21 | 0.18 | 34.44 | 1 | 14.45 |
| Nippon India Gold Savings Fund | 3439.45 | 15.06 | 29.08 | 0.13 | 44.04 | 1 | 15.16 |
| Invesco India Gold ETF FoF | 179.56 | 15 | 28.53 | 0.1 | 32.02 | 0 | 15.7 |
| Kotak Gold Fund | 3506.12 | 14.78 | 28.91 | 0.16 | 44.5 | 1 | 14.71 |
Disclaimer: Please note that the above list of the best gold mutual funds is for educational purposes only, and is not recommendatory. Please do your own research or consult your financial advisor before investing. The data is derived from Tickertape Mutual Fund Screener and is subject to real-time updates.
Note: The data on the list of the best gold investment funds is from 17th September 2025. This data is derived from the Tickertape Mutual Funds Screener.
- Category: FoFs – Gold
- Plan: Growth
- 5Y CAGR: Sorted from highest to lowest
Pro Tip: You can use Tickertape’s Mutual Fund Screener to research and evaluate funds with over 50+ pre-loaded filters and parameters.
Overview of the Gold Mutual Funds
LIC MF Gold ETF FoF
LIC MF Gold ETF FoF invests in LIC MF Gold Exchange Traded Fund. The scheme works as a fund of funds, giving investors indirect exposure to gold prices through mutual fund units, instead of buying or storing physical gold themselves.
Axis Gold Fund
Axis Gold Fund invests mainly in gold exchange traded funds. It is an open-ended mutual fund that tracks gold prices through ETF units. Investors participate in the price movement of gold by holding mutual fund units instead of physical assets.
SBI Gold Fund
SBI Gold Fund invests in SBI Gold Exchange Traded Fund. It is structured as a fund of funds, which means the scheme tracks the performance of gold prices through the ETF. Investors get access to gold indirectly through mutual fund units.
Aditya Birla SL Gold Fund
Aditya Birla Sun Life Gold Fund provides investors with exposure to gold by investing in gold ETFs. It is designed for those seeking portfolio diversification and protection against market uncertainties through gold-linked instruments.
ICICI Pru Regular Gold Savings Fund
ICICI Prudential Regular Gold Savings Fund invests in ICICI Prudential Gold ETF. This fund of funds structure gives investors exposure to gold price changes through ETF units. The scheme tracks domestic gold values through its ETF holdings.
Quantum Gold Saving Fund
Quantum Gold Saving Fund invests its portfolio in Quantum Gold Exchange Traded Fund units. The scheme operates as a fund of funds, following the movement of gold prices in India. Investors hold mutual fund units that reflect gold performance indirectly.
HDFC Gold ETF FoF
HDFC Gold ETF FoF puts its assets into HDFC Gold Exchange Traded Fund. The scheme functions as a fund of funds, allowing investors to track changes in domestic gold prices through ETF units instead of holding gold physically.
Nippon India Gold Savings Fund
Nippon India Gold Savings Fund invests in Nippon India Gold Exchange Traded Fund. As a fund of funds, it gives investors access to gold price movements through ETF units. The scheme tracks domestic gold prices using its ETF investments.
Invesco India Gold ETF FoF
Invesco India Gold ETF FoF invests in Invesco India Gold Exchange Traded Fund. The scheme works as a fund of funds, reflecting changes in domestic gold prices by putting money into ETF units linked to gold performance.
Kotak Gold Fund
Kotak Gold Fund invests in Kotak Gold Exchange Traded Fund units. The scheme is designed as a fund of funds, offering exposure to gold price changes in India by tracking the performance of its underlying ETF holdings.
What Are Gold Mutual Funds?
Gold mutual funds are investment funds that include assets associated with gold. These assets can range from physical gold, such as gold bars, to financial instruments like stocks of gold mining companies and gold exchange-traded funds (ETFs). In India, gold MF schemes often operate using a Fund of Fund (FoF) structure, where the primary investments are in other gold-related mutual funds or ETFs rather than directly holding physical gold.
Fund of Funds (FoF) Type of Gold Mutual Fund
A Fund of Funds (FoF) gold mutual fund invests in other gold-focused funds or ETFs instead of directly buying physical gold or gold stocks. This approach helps diversify investments across multiple funds. FoFs make it easier for investors to gain exposure to gold without needing a demat account. They also remove the need for storing and securing physical gold, though management fees apply.
Tax on Gold Mutual Funds
The tax treatment of gold mutual funds depends on how long you hold the investment. Here’s a breakdown of the tax implications:
| Capital Gains Tax | New Holding Period | New Tax Rate |
| Short-Term Capital Gains (STCG) | Under 24 months | Taxed according to your income tax slab. |
| Long-Term Capital Gains (LTCG) | Over 24 months | 12.5% |
How to Invest in the Best Gold Mutual Funds in India?
You can easily start to invest in the top-performing gold mutual funds in India by following these steps:
- To invest in the gold MF schemes in India, you can visit an equity investment platform such as smallcase
- The next step is to research and identify the gold mutual fund for long-term or short-term, based on your investment thesis. Tools like the Tickertape Mutual Fund Screener can help you filter and compare funds based on parameters such as returns, expense ratio, and fund size.
- Once you shortlist the funds, visit smallcase, log in, and search for the fund by name. You can then choose the investment mode, either a one-time lump sum or a gold fund SIP investment plan, and complete the process.
Benefits of Investing in Gold Mutual Funds
- Minimal Storage Costs: Physical gold needs to be securely stored in vaults or lockers to prevent theft, which can be expensive. In contrast, gold mutual funds are stored digitally in your investment or demat account. This reduces the high costs of physical gold storage and only involves an expense ratio to maintain your investment.
- Lower Acquisition Cost: When an investor purchases gold through a gold mutual fund, they will incur the fund’s expense ratio and potentially an exit load. However, there won’t be manufacturing costs, customs duty, or GST that apply when purchasing gold.
- No Purity Concerns: When buying physical gold, particularly jewellery, purity can be a concern. Gold mutual funds solve this problem as the AMC ensures the purity of the gold backing the fund’s units.
Risks Involved While Investing in Gold Mutual Funds
- Price Volatility: The price of gold can be highly volatile and is influenced by various factors, including economic conditions, geopolitical events, and currency movements. This volatility can cause significant fluctuations in the value of an investment.
- Market Risk: Gold mutual funds are not immune to market risk. If the overall stock market or economy faces a downturn, it can negatively affect the performance of these funds. Market conditions may significantly influence investor sentiment, which leads to fluctuations in the price of gold and related assets.
- Regulatory and Tax Changes: Changes in government regulations or tax policies can impact the performance and taxation of your gold mutual fund. Any updates in legislation or tax rules that could directly affect the returns or the way investment is taxed.
Factors to Consider When Investing in Gold Mutual Funds
- Past Performance: Reviewing the historical performance of various gold mutual fund schemes can give you an idea of how well the fund has managed different market conditions.
- Expense Ratio & Exit Load: The expense ratio is the annual fee a fund charges to cover its operating costs, while the exit load is charged when redeeming units before a specified period. Although they may seem small, over time, they can significantly impact net returns.
- Financial Goals: Before investing, it’s important to clearly define your financial goals. Aligning your choice of fund with your investment timeline is crucial to ensure the strategy matches your objectives.
- Regulatory and Tax Changes: Changes in government regulations or tax policies could impact the taxation or management of your gold mutual fund. When considering a gold mutual fund for long-term investment, it’s important to stay informed about potential regulatory changes.
To Wrap It Up…
Gold mutual funds in India offer diversification and convenient access to the gold market without the need for physical storage. At the same time, they carry risks such as price volatility and global economic dependence, which can affect returns. That’s why analysing these funds carefully and consulting a financial advisor is important to see if they align with one’s goals and risk tolerance.
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Frequently Asked Questions(FAQs) on Gold Mutual Funds
Gold mutual funds are investment funds that primarily invest in various forms of gold, such as physical gold or stocks of companies engaged in gold mining or production. A gold mutual fund portfolio allows investors to gain exposure to the price movements of gold without directly owning physical gold.
There are two main types of gold mutual funds in India: Gold ETFs (Exchange-Traded Funds) and Gold Fund of Funds. Gold ETFs invest directly in physical gold and are traded on stock exchanges, while the gold fund of funds invests in gold ETFs and other gold-related assets.
Yes, you can invest in gold mutual funds through a Systematic Investment Plan (SIP). Many funds allow SIPs on a weekly, monthly, or quarterly basis. You can check the specific fund’s SIP options and timelines before starting.
The gold mutual fund returns depend on various factors, such as gold price fluctuations and market conditions. It’s important to research gold fund investment options and consult a financial advisor to understand both the risks and benefits of investing in them.
The investment horizon can vary depending on market conditions and the future outlook for gold. It’s important to do your own research and develop a gold fund investment strategy that aligns with your financial goals and risk tolerance.
There’s no specific time to invest in gold mutual funds. Understanding the economic environment and your financial goals can help guide your investment decisions.
The choice of gold mutual funds for beginners depends on various factors, such as fund structure, market conditions, and investment goals. Beginners should research precious metals mutual funds carefully and consult a financial advisor before investing.
The best SIP in gold mutual funds depends on individual preferences and investment goals. Investors can use gold mutual fund comparison tools on platforms like Tickertape to review exit load, gold mutual fund NAV, volatility, minimum SIP amount, past performance, and other factors before deciding.
Gold mutual funds allow investment in gold ETFs or sovereign gold bonds, while physical gold includes jewellery, coins, or bars. Investors can easily track and manage gold mutual funds, while physical gold gives you tangible ownership and emotional satisfaction.
