March 16, 2022

Best gold ETFs to invest in the Indian market

  • by Jarrell Marley
  • 5 Months ago
  • Comments Off

People in India love buying gold. The unique yellow metal carries a high perceived value along with a strong emotional connection. For several years, it has been a popular investment product. Purchasing jewelry, gold bars, or gold coins comes with making charges. Thus, the best form of investment in gold is through Gold Exchange Traded Funds. These funds are available at a price close to the current gold rate and cost lesser than physical gold.

ETFs are one of the best long-term investments. You can purchase and trade them only on the cash market of the National Stock Exchange, similar to the stocks of any other company. Trading in Gold ETFs started in 2007.

How to apply for Gold ETFs?

  1. The first step to buying Gold ETF is to open a Demat and trading account with a stockbroker.
  2. Once you receive your user credentials, use them to log in to the broker’s online trading portal.
  3. Next, pick the Gold ETF you wish to buy. Decide whether you want to purchase regularly through a Systematic Investment Plan (SIP) or lump sum. You can also choose mutual funds online with the underlying Gold ETF.
  4. Enter the number of Gold ETF units for which you want to place the buy order.
  5. An order confirmation is sent to your registered email address and phone number.
  6. The online broker portal will debit your bank account with a nominal fee.

You can invest in Gold ETF regularly through a SIP instead of doing it as per the market. This strategy is more profitable than other gold investments.

Best ETFs to invest in 2022

  • SBI Gold Fund
  • Nippon India Gold Savings Fund
  • HDFC Gold Fund
  • Invesco India Gold Fund
  • UTI – Gold
  • Birla Gold ETF
  • Aditya Birla Sun Life Gold Fund
  • Axis Gold ETF
  • Kotak MF-GETF
  • IPRU Gold ETF

How to select an ETF scheme?

The top factors to evaluate the profitability of Gold Exchange Traded Fund schemes are as follows:

  1. Assets under Management (AUM): It is the market value of all the financial assets managed by a company for its investors. A high AUM value indicates a higher number of portfolios and clients handled by the company.
  2. Net Asset Value: It is the value of the assets of the company besides the value of its liabilities. The NAV is equal to the per-share value of the ETF. To arrive at the NAV, the total value of the company’s securities, excluding the liabilities, is divided by the number of outstanding fund shares.
  3. Returns: It refers to the income or profits earned by an ETF portfolio or scheme.

Final thoughts

Gold ETFs are similar to gold. You can use the investments as collateral for loans. The investment is in digital form and therefore has zero storage costs. They can be traded easily in the open market during market hours. This investment option is safer than investing in the physical form of the precious metal. So, if you want to explore the investment product, download the Tata Capital Moneyfy app to start investing within minutes and manage your wealth flawlessly.

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