Dhanteras 2026: Top 5 gold ETFs by 1, 3 and 5-year returns; should mutual fund investors consider them now? Expert views

As Dhanteras approaches on 6 November 2026, many households will consider buying gold coins or jewellery as part of their festive purchases. However, those looking to gain exposure to gold without owning the metal physically can consider gold exchange-traded funds (ETFs).

Gold ETFs offer convenience, transparency, and liquidity, allowing investors to buy and sell units on stock exchanges without worrying about the storage, theft, or purity concerns associated with physical gold. Investors can gain exposure to gold through ETFs without having to spend thousands or lakhs of rupees on physical gold upfront.

According to Value Research data, the gold ETFs or funds category delivered returns of 6.94% year-to-date, 18.64% over one year, 31.90% over three years and 23.15% over five years as of 26 October 2026.

With gold prices witnessing sharp movements and gold fund-of-funds (FoFs) recently suspending fresh subscriptions, investor interest in gold ETFs could rise. Here is a closer look at their recent performance and the factors investors should consider before making fresh investments.

The following gold ETFs feature among the top performers across different investment periods.

*Source: Value Research, Returns as on 26 October 2026

Tata Gold ETF leads the list with a 15.82% 1-year return, closely followed by ABSL Gold ETF at 15.81% and Zerodha Gold ETF at 15.77%.

ICICI Prudential Gold ETF and UTI Gold ETF jointly lead the 3-year CAGR list, delivering returns of 31.20% each. ABSL Gold ETF follows closely at 31.18%.

LIC MF Gold ETF tops the list with a 23.29% 5-year CAGR, followed by UTI Gold ETF at 23.07% and ICICI Prudential Gold ETF and Invesco India Gold ETF at 22.98% each.

Based on this data, LIC MF Gold ETF and ABSL Gold ETF feature among the top performers across all three investment periods. UTI Gold ETF and ICICI Prudential Gold ETF appear in both the three-year and five-year rankings.

The consistent returns show that these ETFs have delivered relatively strong performance across different periods and market cycles.

Gaurav Garg, Head - Research, Lemonn said, “Gold ETFs remain an attractive option for investors looking to diversify their portfolios amid ongoing global economic uncertainty. However, investors should exercise caution before making fresh investments, particularly after sharp movements in gold prices.”

He added that investors may face short-term losses if prices correct from elevated levels. Gold ETFs do not generate regular income, and their returns depend primarily on gold price movements, which are influenced by US interest-rate expectations, dollar movements, geopolitical developments, and the rupee-dollar exchange rate.

“From an investment perspective, investors with a medium- to long-term horizon may consider investing gradually through SIP rather than committing their entire allocation at once. Gold should ideally serve as a portfolio diversification tool rather than a substitute for equity or fixed-income investments,” Garg added.

Sheetal Goel is a Content Producer at Livemint, where she covers corporate developments, personal finance, business trends, markets, and SEBI-related updates. She focuses on simplifying complex financial concepts and presenting them in a clear, reader-friendly manner, thereby helping audiences better understand investment trends, personal finance, and market developments. Her writing focuses on making finance more accessible to everyday readers while maintaining clarity, accuracy, and relevance. <br><br> She holds a degree in Economics (Hons.) along with an MBA in Finance, which has helped her develop a strong foundation in financial analysis, market understanding, and business reporting. Before joining journalism, she worked with finance and broking firms, where she closely followed market developments, investment strategies, and evolving industry trends. This practical exposure strengthened her understanding of financial markets. She has also written content across multiple formats and platforms, including YouTube, LinkedIn, and Instagram. <br><br> Over time, she has developed expertise in covering market-linked stories, investor-focused topics, and regulatory updates in a simplified yet informative style. She also enjoys reading and listening to Hindi poetry, reflecting her appreciation for literature and creative expression beyond the world of markets and numbers.

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