Fund houses plan gold ETFs | india | Hindustan Times
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Fund houses plan gold ETFs

india Updated: Apr 14, 2009 23:12 IST
Sandeep Singh

Mutual fund houses are rushing to cash in on the opportunity offered by rising gold prices and investor interest. While Kotak Mutual Fund is launching its second gold related scheme, Sundaram BNP Paribas AMC and SBI Funds Management are looking to add gold fund products to their kitty.

SBI launched its ETF late last month and Sundaram plans to launch its offering after June as the elections would be over by then and there would be no volatility realting to it, said TP Raman, managing director, Sundaram BNP Paribas AMC.

Kotak Mutual Fund filed its offer document to launch its Gold ETF fund of funds while it already has an ETF.

Fund houses are offering such products because it is the only asset class generating returns, said Keyur Shah, associate director, World Gold Council.

With stock markets down and gold having generated close to 20 per cent in the last one year, fund houses that did not have a gold fund in their kitty are looking to have one.

“While we are looking to complete our bouquet of offering by introducing it, gold as an asset class stands a good chance as an investment mode, since equities will no longer generate returns similar to what they produced earlier, said Raman. “We want to add gold to our investment portfolio,” added Ritesh Shah, gold fund manager, SBI Funds Management.

Fund houses also claim to have received demand for launching gold funds through market research and inputs received from brokers.

Even though gold prices softened over the last one month, the outlook for gold remains positive, said Shah from World Gold Council.