In a dramatic turnaround, February 2026 marked a severe slump in commodity fund investments, which crashed to ₹45,708 crore overall, as detailed in Valm Capital’s Wednesday report. Strikingly, while monthly figures disappointed, yearly returns stood at a robust 80.3%, highlighting the sector’s enduring strength.
Gold’s price retreat post-January highs led the commodity exodus, with sector inflows plummeting 89% from ₹51,483 crore to a mere ₹5,774 crore. Silver followed suit, amplifying the pullback. Money market enthusiasm waned too, flows contracting 45% to ₹42,970 crore amid subdued activity.
Fixed income outflows moderated slightly to ₹16,919 crore from ₹17,037 crore, but the trend of redemptions persisted. Equity held firmer, with a 19% dip to ₹42,017 crore from ₹52,110 crore. Total net flows across mutual funds halved to ₹73,842 crore from January’s peak of ₹1,64,277 crore.
Breaking down equities, broad market funds slipped from ₹30,359 crore to ₹27,254 crore, large-caps from ₹11,007 crore to ₹9,316 crore. Yet, mid and small-caps shone: mid-cap inflows climbed to ₹3,739 crore (up from ₹3,297 crore), small-caps to ₹3,055 crore (from ₹2,536 crore), showcasing investor confidence in value picks during dips.
Factor-based funds posted strong gains, rising to ₹4,495 crore from ₹3,116 crore, boosted by a fresh ‘quality’ NFO launch. February’s landscape normalized after January’s anomalies—gold cooled, money markets steadied, mid/small-caps saw bargain hunting, and fixed income bleed eased marginally.
For investors, this report signals a pivot point: commodities’ high annual yields tempt despite volatility, equities offer selective havens, and tactical shifts toward quality factors could define near-term strategies. As markets stabilize, watchful positioning may yield dividends in the coming months.