India is the world's largest consumer of Gold.Wearing gold ornaments is part of our culture.Appreciation of gold over the periods make it a safe investment even in recessions. The Gold price has appreciated from Rs.245 on 1990 to Rs.2850 in 2012.Compounded annual growth rate of gold in Last 10 years is 18.75 %, which is at par with the stock market indices of India.
Gold ETFs represent the value of physical gold.People can buy and sell it from exchange traded terminals of National stock exchange and Bombay stock exchange during market hours.Pricing is transparent and equal to 1 gram per unit of an ETF.No storage issue or fear of theft.Purity is also high as 24 carat.
Gold ETFs are tax efficient,no Securities transaction tax or wealth tax.An investor of Gold ETF can save the Making charges of ornaments.Because,ETFs are in electronic form.Investor can buy and hold it in demat account.It is accepted as collateral of loans.Another benefit is the absence of entry and exit loads which is applicable in mutual funds.Asset wise,GoldBees leads with Rs.3334 crores assets under management.Next is RelGold with Rs.3040 crores AUM.
Major Gold ETFs in India are : GOLDBEES, RELGOLD, SBIGETS, IPGETF,GOLDSHARE
QGOLDHALF, MGOLD, KOTAKGOLD, IDBIGOLD, BSLGOLDETF, AXISGOLD & HDFCMFGETF.