Even as the NFO of Birla Gold ETF opens on April 25, Axis and Religare file offer documents with SEBI to launch gold fund of funds
Mumbai: Gold funds seem to be the flavor of the season. While two fund houses, Axis and Religare, have filed offer documents with SEBI to launch their gold funds, many more are in the pipeline.
After the launch of Reliance Gold Savings Fund, which collected Rs 500 crore, fund houses are seeing a lot of potential in gold fund-of-funds to woo retail investors who prefer the systematic mode of investing. Fund houses are banking on gold fund-of-funds to attract retail investors who have not been keen on buying gold ETFs through the stock exchange mechanism.
Axis Gold Fund and Religare Gold Fund, both fund-of-funds allow systematic investments with no demat requirement.
Religare Gold Fund will allow minimum investments of Rs 1,000 per month during the NFO and Rs 500 per month thereafter. Axis Gold Fund offers Micro SIP option of Rs 100 per month.
Axis Gold Fund and Religare Gold Fund will invest in their own in house gold ETFs. Currently there are 10 gold ETFs listed on the exchanges.
Recently, Kotak launched its Kotak Mutual Fund on 4 March, 2011. UTI Mutual Fund is also planning to launch its UTI Master Gold Fund soon. Fund houses like Benchmark and SBI are also in the race to come up with their gold fund-of-funds.
The NFO of Birla Sun Life Gold ETF opens on April 25, 2011.
Although India is the largest consumer of gold, the assets under management of gold ETFs constitute just 1 per cent or Rs 4,400 crore of the Rs 7 lakh crore assets managed by the industry. Gold ETFs have been attracting steady inflows in the recent past. In FY11, Gold ETFs collected Rs 2,250 crore compared to Rs 804 core in FY10. Gold prices have shot up 104 % since the last three years from Rs 10,658 to Rs 21,750 in India.
Cafemutual had earlier reported about the rush of gold funds.
