Gold exchange-traded funds (ETFs) recorded a sharp rise in investor inflows in January, overtaking equity mutual funds and signalling a shift in portfolio preferences amid market volatility.

Industry data shows gold ETF inflows jumped 106% month-on-month to a record ₹24,040 crore, marginally higher than equity mutual fund inflows of ₹24,029 crore. The surge, more than double December levels, marks a rare instance where gold attracted inflows on par with equities.

Multi-asset allocation funds also saw strong demand, with inflows rising 41% month-on-month to ₹10,485.38 crore, reflecting a growing preference for diversification and exposure to precious metals. The trend highlights the increasing financialisation of gold as an investment asset in India.

Gold has emerged as the best-performing asset class so far in 2026, with gold ETFs delivering returns of about 16% year-to-date and over 76% in the past year, reinforcing its status as a safe-haven investment.

In contrast, overall equity mutual fund inflows declined 14% to ₹24,028.59 crore in January from ₹28,054 crore in December, according to data from the Association of Mutual Funds in India (AMFI). The slowdown reflects moderation rather than weakening investor sentiment, supported by steady SIP contributions.

Mid-cap and small-cap funds continued to attract inflows of ₹3,185 crore and ₹2,942 crore respectively, but at a slower pace due to elevated valuations, recent market corrections and some profit-booking after strong past performance.