By Admin 
SEBI Gold-Silver ETF Rule Change: The way of investing in precious metals like gold and silver is changing. Now a large number of investors are investing money in gold and silver through ETFs instead of buying physical gold and silver. But the problem arises when the rates of gold in the international market are different, whereas in the Indian market the prices of these ETFs seem to be moving at a different level.
Due to this difference, investors sometimes face difficulty in making the deal at the right price. Due to which many times they have to suffer losses also. In view of this entire situation, the Securities and Exchange Board of India (SEBI) has started preparations to change the rules. Let us know about this….
Challenge of coordination between global market and Indian ETF
Gold and silver are traded in the global market for almost 24 hours. Prices can change rapidly at any time. But in India, gold-silver ETFs trade only during market hours. Due to which there is a possibility of problem arising.
For example, if there is a big jump or a big fall in the prices of gold and silver at midnight due to some major event, then the prices change in the global market but trading in ETFs in India is not taking place at that time. Due to which there is difference in prices.
Also, due to the rules prevailing in the country, there is a fixed price band in the prices of ETFs. Which means that the price cannot go above or below a certain limit in a day’s trading. At the same time, when there is a sudden sharp movement in the global market, Indian ETFs are not able to adjust to this change completely. There is a huge gap between their trading price and actual value (NAV). SEBI believes that this rule is outdated and does not fit completely. There is a need to change these rules.
Price band system will change with market movements
There are preparations to introduce a new ‘dynamic price band’ in place of the fixed price band implemented till now. SEBI Board, in its consultation paper released on 14 February 2026, has suggested that the system should be such that it can adapt itself according to the boom and recession of the market.
According to the proposal, initially the price band will be ±6%, but if there is a sudden sharp rise in gold prices, it can be further increased to 3% in a phased manner.
After every change, a cooling-off period of 15 minutes will be given to give the market a chance to balance. This will be done maximum twice in a day. Also the total range can go up to ±20%. This will increase the chances that the ETF price shown on the screen will be very close to its actual value.
Balance of prices even before opening
SEBI Board has suggested starting ‘Pre-Open Session’ for Gold and Silver ETFs. Like the stock market, a short session will be held before the market opens, so that changes in foreign markets overnight can be adjusted in advance. This will help in reducing the huge gap in prices in the morning and give a balanced start to the investors.
Disclaimer: (The information provided here is being given for information only. It is important to mention here that investment in the market is subject to market risks. Always take expert advice before investing money as an investor. ABPLive.com never advises anyone to invest money here.)
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