Investing in gold, especially during Diwali and Dhanteras, is seen as a lucky tradition in India.
People have multiple options to invest in gold, including physical gold, digital gold, or Gold ETFs (Exchange-Traded Funds).
To align with this festive season, Zerodha Fund House has introduced a new Gold ETF Fund of Funds, allowing investors to invest in Gold ETFs indirectly.
This fund will open for investment on October 25, 2024, and remain available until November 8, 2024.
How Zerodha’s Gold ETF Fund of Funds Operates
Zerodha’s Gold ETF Fund of Funds uses a passive investment strategy by primarily investing in units of Gold ETFs.
Its main objective is to generate strong returns by linking its performance to physical gold prices in the Indian market.
About 95-100% of the fund’s assets will go into Gold ETFs, with a small portion (0-5%) allocated to debt securities and money market instruments.
Investors can start with as little as Rs 500, with a Net Asset Value (NAV) of Rs 10 per unit.
Expert Views on Gold ETF Fund of Funds
According to Vishal Jain, CEO of Zerodha Fund House, gold is a dependable asset that holds its value during inflation.
Gold ETFs, in particular, are a convenient choice since they eliminate concerns about storage or security.
Jain also noted that gold has a low correlation with equity markets, which can help reduce portfolio volatility.
Vaibhan Jalan, Zerodha’s Chief Business Officer, highlighted that the Gold ETF Fund of Funds makes gold investments affordable and accessible.
By offering a Systematic Investment Plan (SIP) option, Zerodha aims to provide both new and long-term investors with a simple way to add gold to their portfolios.
