Mutual Fund Rules Are Changing Radically from April 1! Know the New Updates Now

Mutual fund rules are changing from the first day of April i.e. from the new financial year. SEBI has announced a change in the reference point for gold and silver prices. Mutual funds/ETFS link their NAV (Net Asset Value) to this reference point.

The London Bullion Market Association (LBMA) had a price point till now, but this system is going to change. The price will be determined based on the spot price of the Indian bullion market. This decision of the regulatory body will be effective from April 1, 2026.

SEBI said that the objective of this change is to increase transparency in valuation and ensure that the prices of gold and silver in mutual fund schemes accurately reflect the domestic market trends.

SEBI believes that this will further strengthen the confidence of investors in pricing in commodity-based mutual funds. There was a lot of investment in gold and silver ETFs and mutual funds in 2025.

SEBI said that the decision to shift the reference point from London to India has been taken after detailed deliberations by the Mutual Fund Advisory Committee. The committee was of the view that the spot prices issued by regulated stock exchanges meet the standards of transparency and compliance. The funds will be able to better reflect the actual situation in the domestic market.

ETF

There are several factors for determining the spot prices of the two precious metals in India which make them different from those in the London Bullion Market Association. Exchange rates, customs duties, transportation costs, taxes and other local factors are added to determine the domestic spot prices.

MF and ETF

SEBI feels that the new system will eliminate this unnecessarily complex process and make the valuation more transparent and easy. India imports a large quantity of gold and silver every year and hence, the foreign exchange rate is a major determinant of the spot prices in India.

The prices that the mutual funds will use will be the same spot prices used for settling gold and silver derivative contracts. This system will be in accordance with the spot polling guidelines issued by SEBI from time to time.

This change will come into effect with the ‘SEBI Mutual Fund Regulations 2026’. SEBI also said that the industry body, Association of Mutual Funds in India, will work with SEBI to formulate a uniform policy for the implementation of these rules.