Kotak Silver ETF Fund Suspension Analyzed
Kotak Mutual Fund has temporarily stopped new lump-sum and switch-in investments into its Kotak Silver ETF Fund of Fund, starting October 10, 2025. This means you can’t currently buy a whole chunk of silver or swap money for silver directly. The reason? Silver in India is costing much more than it does elsewhere due to limited supply. Existing investments through SIPs and STPs will still continue to function normally.
Key Points
- Silver premiums in India are significantly higher than global rates.
- New investments paused to protect investors from inflated prices.
- SIP and STP investments remain unaffected and will continue.
- Premium rose sharply from 0.5% to 5.7% recently.
- Fund anticipates premium will normalize in the near future.
- Long-term silver investment outlook remains positive and constructive.
The price difference is because there isn’t enough silver available in India. The premium is the extra amount you pay above the standard international price. It went from around 0.5% to a peak of 5.7% by October 9th. This means people were paying 5.7% more than the market price.
Kotak Mutual Fund believes this is a short-term problem, not a bad idea about silver investments. They think the price difference will eventually go back to normal, and they still think silver is a good investment over the long term. They’re simply waiting for the price to balance out.
Currently, the buying premium is around 10%, meaning you pay 10% more than the market price. The selling premium is about 3%, meaning you’ll get 3% more than the market price. This difference reflects the supply and demand situation.
“This suspension is purely intended to protect investors from entering the market at inflated domestic premiums.”
