National News
SEBI proposes new framework for valuation of gold and silver in ETFs to standardize mutual fund industry practices
New SEBI framework aims to bring transparency and standardization to gold and silver ETF valuations, aligning practices across mutual funds.
The Securities and Exchange Board of India (SEBI) has issued a proposal to introduce a uniform valuation mechanism for gold and silver Exchange Traded Funds (ETFs), marking a significant step towards improving consistency, transparency, and efficiency across the mutual fund industry.
In its consultation paper, SEBI recommends the adoption of domestic spot prices for valuing physical gold and silver assets held by ETFs, replacing the current use of the London Bullion Market Association (LBMA) price in U.S. dollars. At present, different mutual fund houses follow varied valuation methods, which may lead to duplication of effort and inconsistencies in the Net Asset Value (NAV) calculations of these funds.
The move is expected to align the valuation of physical and derivative assets, reduce operational complexity, and better reflect the local market conditions. SEBI believes this change will benefit investors by enhancing comparability and fairness across all gold and silver ETFs.
This proposal reflects SEBI’s commitment to evolving with the changing needs of the financial ecosystem and promoting best practices in asset valuation. Market participants, stakeholders, and the public are invited to share their comments and suggestions on the proposed framework by August 6, 2025.
The session saw a power packed panel of experts that comprisedSurendra Mehta, National Secretary- IBJA,Ranjith Singh,Head of Business Development, IIBX, Shweta Dhanak, Director – Vijay Exports,S Thirupathi Rajan, MD Goldsmith Academy, Shivanshu Mehta, SVP & Head Bullion-MCX.The session was moderated by Chirag Seth, Principal Consultant, Metals Focus.
Some salient points made by the panelists:
- Gold prices are not linked to consumer demand. They are linked to central bank buying and ETFs
- Till the banking system doesn’t collapse, gold price will continue to rise
- Jewellers were advised to use a mix of futures and options for risk mitigation
- Given the current situation manufacturers selling on credit or unfavorable deals could be fatal flaw for business.
- Precious metals forecast: Surendra Mehta said he sees gold in 2026 in $4900-5100 range and silver in $90-105.Looking further he said by 2030-2035 gold could touch $18000- 20000 and silver could reach $500. Chirag Seth predicted silver touching $105 this year and gold moving in the $ 5200- $ 5500.
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