In a historic shift for the Indian mutual fund industry, precious metals emerged as the dominant asset class in January 2026. Combined net inflows into gold and silver exchange-traded funds (ETFs) reached a record **₹33,503 crore**, officially surpassing net equity fund inflows for the first time. The surge was led by gold ETFs, which attracted **₹24,040 crore**, a significant jump from the **₹11,647 crore** recorded in December. This movement coincided with a 14% decline in equity fund inflows, which cooled to **₹24,028 crore** during the same period. Silver ETFs also saw a massive spike, with inflows rising 139% to reach **₹9,463 crore**. Total assets under management (AUM) for the mutual fund industry climbed to **₹81.01 lakh crore**. Within this, the gold ETF segment saw its AUM swell to **₹1.84 lakh crore**, marking a 44% increase in a single month. The combined gold and silver ETF AUM has now crossed the **₹3 lakh crore** milestone. Investor behavior has been driven by exceptional trailing returns. Over the past year, gold delivered approximately **80%** returns, while some silver ETFs posted gains as high as **180%** prior to recent volatility. This performance outpaced the modest **8% to 10%** growth seen in major domestic equity indices like the Nifty 50 and Sensex during 2025. Market prices reached unprecedented levels in late January. 24K gold hit a lifetime high of **₹1,75,930 per 10 grams** on January 29, while silver futures briefly breached the **₹4 lakh per kg** mark. These peaks were fueled by global geopolitical tensions, a weakening rupee, and consistent central bank buying. However, the beginning of February introduced sharp corrections. A shift in global sentiment, triggered by expectations of a more hawkish US Federal Reserve, led to a dramatic sell-off. Gold prices retreated toward **₹1.55 lakh per 10 grams**, and silver fell roughly 42% from its peak to settle near **₹2.5 lakh per kg**. Despite the recent price correction, the number of investor accounts continues to grow. Gold ETF folios rose to **1.14 crore**, while silver ETF folios surged over 323% to reach **47.85 lakh**. Experts view this as a structural shift where investors are increasingly using precious metals as a portfolio stabilizer. Current market guidance suggests maintaining a disciplined allocation of **10% to 15%** in gold and silver. While the record inflows indicate strong momentum, the high volatility in silver highlights the risk of performance-chasing. Staggered investments through systematic plans remain the preferred entry strategy at current elevated price levels.