Description
ICICI Prudential has temporarily discontinued subscriptions in Silver ETF Fund of Fund due to inflated silver prices in India caused by local supply shortages, effective October 14, 2025.
Summary
ICICI Prudential Asset Management Company has temporarily suspended all new subscriptions in ICICI Prudential Silver ETF Fund of Fund (Silver ETF FOF) effective October 14, 2025. The suspension includes lump sum investments, switches, and fresh SIP/STP registrations. This decision was made to protect investor interests due to inflated silver prices in India caused by local supply shortages that have pushed domestic silver prices significantly above global benchmarks. Redemptions and existing systematic transactions will continue normally.
Key Points
- Temporary discontinuation of all subscriptions (lump sum, switches) and fresh SIP/STP registrations in Silver ETF FOF from October 14, 2025
- Approved by ICICI Prudential Trust Limited
- Primary reason: Silver prices in India have risen significantly above global benchmarks due to local supply shortages
- Inflated prices of silver ETFs on the exchange due to premium in domestic silver prices
- Physical silver supply constraints in bullion market expected to continue in near future
- Existing systematic transactions registered prior to October 14, 2025 will continue to be processed
- Redemptions and switch-outs remain permitted during suspension period
- All purchase/switch-in transactions timestamped on or before 3:00 PM October 13, 2025 will be processed at applicable NAV
- Suspension is temporary and will continue until further notice
Regulatory Changes
No regulatory changes. This is an operational decision by the AMC to temporarily restrict new investments in the scheme.
Compliance Requirements
- AMC will continue processing existing systematic transactions registered before October 14, 2025
- AMC must continue to permit redemptions and switch-outs as per Scheme Information Document terms
- Investors should be informed through this Notice-cum-Addendum which forms integral part of SID and KIM
- Investors are requested to periodically review and update KYC details including mobile number and email ID
Important Dates
- October 13, 2025, 3:00 PM: Cut-off time for last accepted purchase/switch-in transactions
- October 14, 2025: Effective date of subscription suspension
- Until further notice: Duration of suspension period
- Notice dated: October 13, 2025
Impact Assessment
Market Impact: The suspension reflects a significant market anomaly where domestic silver prices have diverged substantially from global benchmarks due to supply-side constraints. This indicates stress in the physical silver market in India and impacts the normal functioning of silver-linked investment products.
Investor Impact: Existing investors seeking to increase positions or new investors wanting exposure to silver through this FOF are blocked from doing so. However, the measure protects investors from entering at potentially inflated valuations. Existing investors can still exit their positions through redemptions.
Operational Impact: The Silver ETF FOF cannot make fresh investments in the underlying Silver ETF during this period, which may affect the scheme’s ability to scale or rebalance. The underlying issue stems from the Silver ETF’s challenge in acquiring physical silver at reasonable prices due to market shortages.
Systemic Implications: This highlights broader commodity supply chain issues in India’s bullion market and demonstrates how physical market constraints can necessitate restrictions in financial products linked to those commodities.
Impact Justification
Complete suspension of new investments in a commodity ETF FOF due to market anomalies affects investor access and reflects significant supply-side disruptions in the physical silver market.