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Business News/ Money / Personal Finance/  NFO Alert: Mirae Asset launches Gold ETF. Should you invest?
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NFO Alert: Mirae Asset launches Gold ETF. Should you invest?

The offer will close on Feb 15. The minimum investment during the NFO period is Rs 5,000 and there is no exit load. The scheme’s benchmark would be domestic prices of physical gold.

The scheme will re-open for continuous sale and repurchase from February 21.Premium
The scheme will re-open for continuous sale and repurchase from February 21.

Mirae Asset will launch a new fund offer (NFO) for its gold ETF on February 9. The offer for this exchange-traded fund will close on Feb 15. The fund units will be allotted on February 20 and the scheme will re-open for continuous sale and repurchase from February 21 onwards.

The minimum investment during the NFO period is Rs 5,000 and in multiples of Re 1 thereof. There is no exit load and the scheme’s benchmark are domestic prices of physical gold.

The fund is meant for investors who are seeking returns in line with physical gold over medium to long term and the scheme's risk-o-meter indicates this as an investment with a high risk.

The scheme will be managed by Mr Ritesh Patel. The scheme will invest a minimum of 95 percent of assets in gold and gold related instruments.

Particulars                 Details
NFO opens                  Feb 9
To close                     Feb 15
Minimum Investment              Rs 5,000
Allotment of units      Feb 20

The remaining funds (up to a maximum of 5 percent) will be invested in money market instruments including debt securities, instruments and/or units of debt/liquid schemes of domestic mutual funds.

Why should you invest?

The gold ETFs enable ease of transaction for investors with barely one unit of minimum investment. “Gold is considered to act as a hedge against inflation and is known as one of the safe investment option during the times of turmoil," said Mirae Asset in a statement.

ALSO READ: Which is a better investment: Gold mutual funds or gold ETFs?

Also, transactional expenses in a gold ETF are less than that of physical gold.

Unlike physical gold, there is no hassle of storage. The prices of gold ETFs is available on real time basis and importantly -- investment of this gold ETF would be made in standard bullion of 99.5 percent purity.

Also, continuous liquidity is provided by authorised participants on exchange at all times around latest NAV.

Mirae Asset said, in a statement, that gold delivered an impressive return of 10.9 percent in the Calendar Year 2022 against Nifty 50’s muted 5.7 percent return.

While hinting at the recessionary outlook, the AMC asserts that gold has historically done well during the time of recession.

Gold ETFs versus Gold mutual funds
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Gold ETFs versus Gold mutual funds

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Published: 08 Feb 2023, 04:54 PM IST
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