With festive season round the corner, shopping markets are abuzz with customers flocking for precious metal. Hindus considered it auspicious to buy properties, start new ventures and especially accumulating wealth in terms of gold and silver. When the traditional approach of buying gold or silver coins with emblem of Godess Laxmi might not be replaced with any other form, a partial investment in paper gold or even virtual gold is worth considering enough.
Buying Gold Exchange Traded Funds (Gold ETFs) might not be looked upon as an exciting purchase during festivals when the factor of touch and feel of the metal matters more there are some rational reasons why one should look for it.
The difference arising from the market price of purchases is always higher than the price of selling back the physical metal. It applies for both gold and silver and coins and jewellery. Secondly, the advantage of volatility might not be available in physical gold which is there in the Gold ETFs. For stocking gold one does not need to spend on bank lockers and worry about the safety if invested through ETFs. If an investor is not an expert of identifying the quality of metal stands a risk of being duped by seller with substandard quality. Such a risk is eliminated while investing in ETFs.
ETFs are a very good way of investment for safety concerned investors who just need to have a Demat account. Gold ETFs are available in the market to buy paper Gold. It is the easiest and hassle-free method to maintain Gold.
The size of assets held through gold exchange traded funds is an all-time high of Rs. 11,198 crore. The surge in asset size of gold funds has come at a time when the government is contemplating steps to encourage large flow of household savings into equity, mutual funds and other financial instruments, rather than to idle assets like gold.
According to AMFI, the assets under management of gold ETFs crossed the Rs. 11,000 crore mark in September from Rs. 10,701 crore in August. In June, investor wealth in gold ETFs surpassed the psychological mark of Rs. 10,000 crore; it was just above Rs. 5,000 crore level till a few months ago in May 2011.
There are about 25 different gold ETF schemes across 14 different fund houses at present. These products, which track the metal’s prices, provide an opportunity to investors to accumulate gold over a given period of time since they can be purchased in small quantities.
MF UPDATE
SBI announces dividend for its scheme
SBI MF has announced dividend under SBI Magnum Sector Funds Umbrella-Contra Fund, an open ended growth scheme. The quantum of dividend for distribution will be Rs. 2 per unit on the face value of Rs. 10 per unit. The record date for dividend distribution is 19th October 2012.
Principal announces change in Fund Manager for its scheme
Principal MF has announced change in fund management responsibilities under Principal Retail Equity Savings Fund, with effect from 15th October 2012. Accordingly the new fund manager will be P.V.K. Mohan. The investment objective of the scheme is to provide long term capital appreciation and regular income by investing in equity and equity related instruments and also in debt and money market instruments.
ICICI Prudential announces change in exit load exit load
ICICI Prudential MF has announced to revise exit load structure under ICICI Prudential Gilt Fund Treasury Plan – PF Option. Accordingly, an exit load of 0.50% will be charged if units are redeemed or switched out within 6 months from the date of allotment. The revised exit load structure will be effective from 15th October 2012.
ICICI Prudential Banking & PSU Debt Fund announces dividend
ICICI Prudential MF has announced dividend under the dividend option of ICICI Prudential Banking & PSU Debt Fund. The quantum of dividend for distribution will be Rs. 0.1746 per unit on the face value of Rs. 10 per unit. The record date for dividend distribution is 22nd October 2012.
Birla Sun Life Income Plus announces change in exit load
Birla Sun Life MF has announced to revise exit load structure under Birla Sun Life Income Plus, an open ended income scheme. Accordingly, an exit load of 1% will be charged if units are redeemed or switched out within 180 days from the date of allotment and nil if redeemed after 180 days from the date of allotment. The revised exit load structure will be effective from 19th October 2012.
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