Gold’s record inflows from Asian ETFs seen by some as warning

Precious metals ETFs listed in the region have attracted $7.1 billion in net inflows in January, with a number drawing in all-time amounts of capital, according to data compiled by Bloomberg

• Asian gold ETFs saw record $7.1B inflows in January, led by China-listed funds.
• Gold prices surged over 20% since January, sparking concerns of a rally peak
• China's UBS SDIC Silver Fund paused subscriptions after massive inflows

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Asian investors are pouring record amounts into gold exchange-traded funds, leading some to question whether the rally in bullion is getting close to topping out.

Precious metals ETFs listed in the region have attracted $7.1 billion in net inflows in January, with a number drawing in all-time amounts of capital, according to data compiled by Bloomberg. The biggest gains were seen by funds listed in China that cater to retail investors, with Huaan Yifu Gold ETF alone luring in $1.9 billion.

The price of bullion has skyrocketed is recent weeks, with the yellow metal advancing more than 20% since the start of January, despite a pullback on Friday. High levels of buying by retail investors is often seen as a sign a rally is in its later stages and an asset is overvalued.

“We have been major gold bulls in this cycle,” buying both gold-mining stocks and ETFs, said Nick Ferres, chief investment officer at Vantage Point Asset Management in Singapore. “However, the recent price action has become rapid, emotional and non-linear, which is a warning sign that the trend is extended tactically.”

Gold’s breakneck rally has been underpinned by elevated central-bank purchases and inflows into bullion-backed ETFs. Total holdings in gold-backed funds rose every month last year except May, according to World Gold Council data. Precious metals have also benefited from a switch away from the dollar due to unpredictable US policymaking and increasing American isolation.

Amid other warnings signs, gold’s relative strength index has climbed to about 90, above the level of 70 that is taken to indicate a pullback is overdue. A successful outcome from policies set by the Trump administration would accelerate economic growth, leading to higher interest rates and a stronger US dollar, pushing gold lower, the World Gold Council said in its 2026 outlook published last month.

Among other China-listed funds that have seen sizable inflows in January, the ChinaAMC Gold ETF drew in $420 million, while the GF Shanghai Gold ETF attracted $191.4 million, both set for records, data compiled by Bloomberg show.

Some silver-focused Asian ETFs are also heading for monthly inflow records. South Korea-listed Samsung KODEX Silver Futures Special Asset ETF has gained $231.6 million in net inflows for January, also set for a record.

Subscriptions Halted

In another sign of frenzied demand, China’s only pure-play silver fund — the UBS SDIC Silver Futures Fund LOF — paused subscriptions on Wednesday and halted trading Friday, after massive inflows drove the fund to an elevated premium over its underlying assets.

Asset management companies are set to respond to the rising demand for gold ETFs by bringing new products to the market, according to Bloomberg Intelligence.

“ETF issuers are likely to tap demand for safe-haven assets with more gold-related funds,” analysts Rebecca Sin and Michelle Leung wrote in a research note. “Hong Kong, which offers tools ranging from low-cost physical tracking to leveraged futures and mining equities, has two new listings this week as it seeks to strengthen its position as a gold trading hub.”