SBI Funds, the joint venture between the State Bank of India, country’s largest bank and Societe General AMC (France) have launched a Gold Exchange Traded Scheme - SBI GETS.
A passively managed open-ended mutual fund, it would invest in gold and endeavor to track the price of the yellow metal.
The investment objective of the scheme is to seek to provide returns that closely correspond to returns provided by price of gold through investment in physical gold.
The new fund offer (NFO) opens on March 30, 2009 and would close on April 28, 2009. The net asset value (NAV) would be disclosed on every business day.
“Given the uncertainties in the global economic environment, gold as an asset class offers an excellent hedge. Gold ETF is the most efficient way of owning this asset. It is an interesting option to enhance portfolio diversification,” said Navneet Munot, Chief Investment Officer, SBI Mutual Fund.
The minimum initial investment is Rs5,000 and in multiples of Re1 thereafter with no upper limit during the NFO period. Each unit of SBI GETS will be approximately equal to the closing price of 1 gram of gold on the date of allotment.
After the close of the NFO, the units of SBI GETS would be listed on National Stock Exchange (NSE); subsequent buying and selling by investors can be made from the secondary market on the NSE.
Units are being offered on a face value of Rs100 each (subject to applicable load) and issued at a premium equivalent to the difference between allotment price and the face value of Rs.100/- during the New Fund Offer.
SBI GETS can be bought through any of the distributors, SBI MF Investors Service Centres and Desk, District Organizers and franchisees.
The units of SBI GETS will be issued in dematerialized form through depositories and are proposed to be listed on National Stock Exchange to provide liquidity through secondary market.
An investor can thus buy /sell SBI GETS units through National Stock Exchange (NSE), in the same way as trading in equity stocks.
Click here for the scheme’s Investment Objective