ETF trading activity on the NSE has surged nearly 19-fold over the past five years, driven primarily by strong demand for gold and silver ETFs. Commodity ETFs now account for the largest share of ETF turnover, reflecting investors' growing preference for precious metals as a portfolio hedge amid market uncertainty.

Average daily turnover in exchange traded funds on the National Stock Exchange has climbed from ₹237 crore in FY21 to ₹4,577 crore in FY26, an increase of nearly 19 times in just five years. For an asset class that used to sit quietly at the bottom of most trading terminals, that kind of jump is hard to ignore. The first quarter of FY27 (April to June 2026) held broadly steady at ₹4,390 crore a day, a mild 4% dip from the FY26 average, suggesting the surge is settling into a higher base rather than fading out.

The real story, though, is in the mix. Commodity ETFs, led overwhelmingly by gold etf and silver etf, went from a modest ₹224 crore a day in FY25 to ₹2,907 crore in FY26. That single category now makes up nearly 60% of all ETF turnover on the exchange, a share that would have sounded far-fetched even two years ago when equity ETFs like Nifty BeES ruled the segment. In Q1 FY27 commodity turnover held near ₹2,292 crore a day, still comfortably the largest slice of the pie.

Debt ETFs have had a quieter but equally consistent climb, moving from ₹35 crore in FY21 to over ₹1,000 crore a day in the June 2026 quarter, a roughly 30-fold rise. Equity ETFs, once the default entry point for retail investors into passive investing, grew too, from ₹175 crore to ₹1,040 crore, but their share of the overall pie has shrunk as gold etf and silver etf pulled ahead.

What is driving the gold etf and silver etf rush

Flows data tells a similar story. Net inflows into gold ETFs touched ₹68,868 crore in FY26 alone, roughly 38% of all passive fund inflows for the year. Silver ETFs were not far behind, pulling in ₹30,412 crore, close to 17% of the total. Rising global uncertainty, a weak rupee at various points in the year and repeated record highs in bullion prices appear to have pushed both seasoned and first-time investors toward metals as a hedge, using the ETF route instead of physical gold or silver.

Passive investing keeps growing

The broader passive fund industry in India, which includes both index funds and ETFs, now manages assets worth ₹14.82 trillion as of June 2026. Net inflows into passive schemes stood at ₹34,641 crore in the April to June 2026 quarter, recovering to ₹16,622 crore in June after a comparatively weak May. Within this, index funds pulled in the larger share of fresh money during the quarter, while ETFs contributed a smaller but still meaningful portion.

Retail investor takeaway: The shift toward commodity ETFs shows Indian investors increasingly using gold etf and silver etf as a portfolio hedge rather than only a festive purchase. Liquidity in these ETFs has improved sharply, narrowing the gap between market price and NAV, which matters for anyone entering or exiting in size. Equity and debt ETFs remain useful building blocks for diversification, but allocation decisions should be based on individual risk appetite and financial goals rather than turnover trends alone.

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Average daily ETF turnover: NSE (₹ crore)

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On the BSE, ETF turnover trends have moved in a similar direction, though volumes remain a fraction of NSE levels. Average daily turnover on BSE rose from ₹27 crore in June 2023 to ₹118 crore in June 2025 and further to ₹228 crore in June 2026, reflecting the same broad pull toward passive products across exchanges.

For an Indian investor tracking where money is moving, the data points to one clear trend: commodities have overtaken equity as the engine of ETF trading activity, at least for now. Whether this holds once gold etf and silver etf prices stabilise, or whether equity ETFs claw back share as market sentiment shifts, will be worth watching over the coming quarters.
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