As the festive season approaches, many investors look for reliable and meaningful ways to enhance their portfolios, especially with gold being a traditional favorite during Diwali. This year, Zerodha, India’s leading online stock broking firm, has introduced a fantastic opportunity for gold investment with the launch of its Zerodha Gold ETF Fund of Funds (FoF). This open-ended scheme will be available for subscriptions from October 25 to November 8, 2024.
What is Zerodha Gold ETF FoF?
The Zerodha Gold ETF FoF is a passive investment scheme designed to invest primarily in units of Gold ETFs, making it an ideal choice for those looking to gain exposure to gold without the hassle of storing physical assets. The fund aims to allocate 90% to 100% of its assets into Gold ETFs, which track the performance of physical gold in the domestic market.
Why Invest in Gold ETFs?
Gold has long been regarded as a safe-haven asset, especially during periods of economic uncertainty or inflation. Here are a few reasons why Zerodha’s Gold ETF FoF stands out:
- Lower Volatility: Gold has a low correlation with equity markets, which can help to stabilize your overall investment portfolio. This makes it a suitable option for risk-averse investors.
- Convenience: Investing in Gold ETFs eliminates the challenges associated with physical gold, such as storage and security concerns. With Gold ETFs, you invest in gold digitally, making the process seamless.
- Liquidity: Gold ETFs can be bought and sold on stock exchanges like BSE and NSE, offering liquidity similar to that of stocks.
- SIP Option: For those who prefer gradual investment, Zerodha offers the option to invest through a Systematic Investment Plan (SIP), with a minimum entry point of just ₹500. This approach allows investors to build their gold exposure over time, making it accessible for both first-time and seasoned investors.
Expert Insights
Vishal Jain, CEO of Zerodha Fund House, emphasizes that gold serves as a reliable commodity that retains value during inflationary times. He states, “This fund provides a convenient and effective method for investing in gold without worrying about storage or security.” He adds that the low correlation of gold with equity helps lower the overall volatility of investment portfolios.
Vaibhav Jalan, CBO of Zerodha Fund House, echoes this sentiment, noting that the Gold FoF aims to simplify gold investing for everyone.
Key Details of the Fund
- Investment Objective: Seek capital appreciation through investment in units of Gold ETFs.
- Asset Allocation: 95%-100% in Gold ETFs and 0%-5% in debt securities and money market instruments.
- Starting NAV: Approximately ₹10.
Conclusion
With the festive spirit of Diwali around the corner, the Zerodha Gold ETF FoF presents an attractive investment opportunity for those looking to diversify their portfolios with gold. Whether you are a seasoned investor or just starting, this scheme provides a straightforward and effective way to invest in gold.
Don’t miss out! Mark your calendars for October 25, 2024, and get ready to invest in a bright future with Zerodha’s Gold ETF Fund of Funds.
For more information, you can read the full article here.
Disclaimer
The information provided in this blog is for educational purposes only and should not be considered financial advice. Investing in mutual funds and ETFs involves risks, including the potential loss of principal. Past performance is not indicative of future results. Please consult with a qualified financial advisor before making any investment decisions. Zerodha Fund House and its affiliates do not guarantee any returns on investments made in the Zerodha Gold ETF Fund of Funds.
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