Gold has always been the most reliable and safe means of investment for Indian families. But, with the changing world, investment methods are also changing. Today’s sensible investors are preferring to invest money in ‘Digital Gold’ i.e. Gold ETF instead of going to a goldsmith’s shop and buying jewelery or coins. The biggest reason for this is that it neither has to bear the huge loss of making charges like jewellery, nor is there any hassle of getting it stolen or having a bank locker to keep it safe. Talking about earnings, Gold ETFs have made investors rich in recent years. As per the latest data, leading gold ETFs have delivered impressive annual compounded returns (CAGR) of up to 34% in the last three years.
What is the mathematics of digital gold?
Gold ETF is actually a form of mutual fund, which is directly listed in the stock market. You can easily buy or sell it through your Demat account like shares of any company. It is directly related to the prices of gold in the domestic market. As gold prices rise in the market, the value of your gold ETF also increases at the same pace. The biggest advantage for the common man is its ‘liquidity’, that is, if needed, you can get money by selling it immediately.
UTI fund turns out to be ‘Sikander of the market’
If we talk about funds with Assets Under Management (AUM) of more than Rs 1500 crore, then UTI Gold ETF has won. As of July 2, the fund has given investors an annual return of 34.0% in the last three years, while its benchmark has returned just 1.7%. That means this fund has beaten its benchmark by a huge margin of 32.2%. It also leads in one year performance with a return of 45.6%.
Top 5 earning digital gold funds
- UTI Gold ETF: Returns of 34.0% in three years and 45.6% in one year. Its fund size is Rs 4,382.2 crore.
- ICICI Pru Gold ETF: It is the largest fund in the country with a huge corpus of Rs 27,578.2 crore, which has given 33.7% returns in three years.
- Mirae Asset Gold ETF: This fund has given 33.6% profit in three years. Its performance has been very stable even during the downturn.
- Aditya Birla SL Gold ETF: It has given tremendous profits of 33.6% in three years and 45.4% in one year.
- Kotak Gold ETF: This gold ETF with a fund size of Rs 14,891.9 crore has also given an excellent return of 33.6% in three years.
Why is this a better option for the common investor?
If you want to add the sparkle of gold to your portfolio, digital gold is a trendy and safe way to go. There is no worry about purity like physical gold. Neither does one have to pay for the locker to keep it nor is any money deducted in the name of making charge while selling it. This ‘digital gold’ listed in the stock market has become the strongest weapon to beat inflation in today’s times.
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