Commodity ETFs see record $11 billion outflows in March

Thursday 26 March 2026 - 14:00

By: Dakir Madiha

Commodity ETFs see record $11 billion outflows in March

Investors pulled about $11 billion from commodity exchange-traded funds in March 2026. This marks the largest monthly withdrawal on record, per Bloomberg Intelligence data on roughly 100 ETFs in precious metals and broad commodities. The exodus reverses billions in inflows from weeks earlier amid geopolitics, Treasury yield spikes, and leveraged position liquidations.

Outflows accelerated after US-Israeli strikes on Iran from February 28. The conflict disrupted Strait of Hormuz shipping and drove oil prices sharply higher. Yet war initially lifted commodities before broader market reassessment hammered gold and silver, the very safe havens investors had piled into.

SPDR Gold Shares saw $2.9 billion exit in one March 19 session. iShares Silver Trust traded at a rare discount to net asset value. Investment Company Institute weekly data showed $3.62 billion commodity fund outflows for the week ended March 18, after $1.63 billion prior. ETF Action logged $4.44 billion for the week to March 22, with precious metals accounting for nearly $4.9 billion of losses.

The Bank for International Settlements' March 16 paper "Boom and bust of the recent silver and gold rush" blamed the sharp correction on retail investor exuberance funneled through ETFs. Leveraged products' daily rebalancing and margin call liquidations worsened it. Gold rose about 60 percent in 2025 before peaking late January 2026. Silver doubled in 2025, surged 50 percent more in January, then plunged 30 percent in one day.

Some market players see long-term commodity case intact despite short-term pain. Commodities lag stocks for over a decade. Investor allocations hover near record lows excluding gold, per Topdown Charts research. GammaRoad Capital Partners' Jordan Rizzuto told MarketWatch in January the era saw "one of the strongest rallies in financial assets versus hard assets," with potential "tectonic" shifts underway.

Retail investors view the dip as a buying chance rather than full exit. eToro's March 24 survey of 11,000 investors across 13 countries found commodity holdings at 32 percent, highest since Q3 2023 tracking began. Among holders, 69 percent own gold for store-of-value and inflation hedge roles.

Whether March's record outflows signal structural shift or painful but temporary deleveraging purge hinges on Middle East conflict resolution speed and Treasury yield trends. As of March 25, the US prepared plans to end the Iran war, potentially stabilizing markets.