Description

Kotak Mahindra AMC temporarily suspends fresh subscriptions in Kotak Silver ETF Fund of Fund effective October 10, 2025, due to premium in domestic silver prices caused by physical silver shortage.

Summary

Kotak Mahindra Asset Management Company Limited has temporarily suspended all fresh/additional lumpsum and switch-in transactions in the Kotak Silver ETF Fund of Fund effective October 10, 2025. The suspension is due to domestic silver trading at a premium relative to international prices, caused by a shortage of physical silver in the domestic market. The Fund of Funds invests in Kotak Silver ETF, which tracks domestic silver prices, making it directly impacted by the current premium. This measure is taken in the interest of investors and is temporary in nature.

Key Points

  • Temporary suspension of fresh/additional lumpsum and switch-in transactions in Kotak Silver ETF Fund of Fund
  • Effective date: October 10, 2025
  • Reason: Domestic silver trading at premium due to physical silver shortage in domestic market
  • Kotak Silver ETF Fund of Fund is an open-ended Fund of Funds scheme investing in units of Kotak Silver ETF
  • Kotak Silver ETF tracks domestic silver prices, directly affected by the current premium
  • All transactions timestamped on or before 3:00 PM on October 09, 2025 will be processed at applicable NAV
  • Existing/new SIPs, STPs, and other systematic plans remain operational
  • Redemptions and switch-outs continue to be permitted as per Scheme Information Document
  • Suspension is temporary and will continue until further notice

Regulatory Changes

No regulatory changes. This is an operational measure taken by the fund house under existing regulatory framework to protect investor interests during abnormal market conditions.

Compliance Requirements

  • Distributors and intermediaries must inform investors about the temporary suspension
  • No fresh lumpsum or switch-in applications should be accepted for this scheme from October 10, 2025
  • Existing systematic plans (SIP/STP) should continue as normal
  • Redemption and switch-out requests must continue to be processed as per normal procedures

Important Dates

  • October 09, 2025, 3:00 PM: Cut-off time for last accepted purchase/switch-in transactions
  • October 10, 2025: Effective date of subscription suspension
  • Duration: Until further notice

Impact Assessment

Investor Impact:

  • New investors cannot make fresh investments in lumpsum mode in Kotak Silver ETF Fund of Fund
  • Existing investors cannot add additional lumpsum investments or switch-in from other schemes
  • Existing and new SIPs/STPs remain unaffected, allowing systematic investments to continue
  • All redemptions and switch-outs continue normally, ensuring liquidity for existing investors

Market Impact:

  • Reflects broader issue of domestic silver market shortage and price premium
  • Preventive measure to avoid potential disadvantage to new investors entering at elevated domestic prices
  • Demonstrates fund house’s risk management and investor protection approach
  • Limited systemic impact as this affects one specific fund product

Operational Impact:

  • Temporary measure with no permanent changes to scheme structure
  • Fund house retains flexibility to resume subscriptions when market conditions normalize
  • Other terms and conditions of the Scheme Information Document remain unchanged

Impact Justification

Temporary operational measure affecting specific fund subscriptions due to market conditions. Existing investors and redemptions unaffected. SIPs and STPs continue normally.