Description

HDFC Mutual Fund has temporarily restricted subscriptions in HDFC Silver ETF Fund of Fund to Rs. 1 lakh per PAN per day due to recent volatility in silver prices, effective after 3:00 PM on October 14, 2025.

Summary

HDFC Mutual Fund has imposed temporary restrictions on subscriptions in HDFC Silver ETF Fund of Fund effective after the cut-off time (3:00 PM) on October 14, 2025. The restrictions limit new subscriptions to Rs. 1 lakh per PAN per day at the first holder level. This measure has been implemented to protect investor interests in light of recent volatility in silver prices. All existing systematic investments and redemption transactions will continue without restrictions.

Key Points

  • Subscription limit of Rs. 1 lakh per PAN per day imposed on HDFC Silver ETF Fund of Fund
  • Restriction applies to lumpsum purchases and switch-ins
  • New systematic registrations (SIP, STP-in, etc.) also subject to the Rs. 1 lakh daily limit
  • Existing systematic registrations (SIP, STP) will continue to be processed normally
  • All redemption and switch-out transactions remain unaffected
  • Restriction effective after 3:00 PM on October 14, 2025
  • Duration: Until further notice
  • Reason: Recent volatility in silver prices

Regulatory Changes

This is an addendum to the Scheme Information Document (SID) and Key Information Memorandum (KIM) of HDFC Silver ETF Fund of Fund. The temporary restrictions represent a fund management decision rather than a regulatory mandate, implemented under the fund’s discretion to protect investor interests during periods of heightened market volatility.

Compliance Requirements

  • Investors planning new investments in HDFC Silver ETF Fund of Fund must adhere to the Rs. 1 lakh per PAN per day limit
  • Limit applies at the first holder level for subscription calculations
  • Distributors and platforms must ensure subscription limits are enforced for all new lumpsum purchases, switch-ins, and new systematic plan registrations
  • Existing SIP, STP, and other systematic investments can continue without modification
  • This addendum forms an integral part of the scheme documentation

Important Dates

  • October 14, 2025 (3:00 PM): Cut-off time after which subscription restrictions become effective
  • October 15, 2025: Addendum dated and issued
  • Until further notice: Duration of the temporary restrictions

Impact Assessment

Investor Impact:

  • New investors or existing investors seeking to increase their exposure to silver through this fund of fund will face investment limitations
  • The Rs. 1 lakh per PAN per day cap may require larger investment plans to be staggered over multiple days
  • Existing systematic investment plans remain unaffected, ensuring ongoing investor commitments are honored
  • Redemptions are not restricted, maintaining liquidity for existing investors

Market Impact:

  • The restrictions reflect heightened volatility in silver commodity markets
  • Measure aims to prevent excessive inflows during volatile periods that could disadvantage existing unitholders
  • Similar restrictions may be implemented by other fund houses if silver volatility persists
  • Limited direct impact on broader market as this affects a single fund scheme

Operational Impact:

  • Fund distributors and platforms must update their systems to enforce the daily subscription limits
  • Investor queries and exceptions may increase temporarily as new restrictions are communicated
  • The “until further notice” duration creates uncertainty for investors planning larger allocations to silver investments

Impact Justification

Temporary subscription restrictions on a single fund scheme due to commodity market volatility. Protects investors but limits new investments. Existing systematic plans and redemptions unaffected.