Since the stock market began to decrease, investors have been searching for a secure investment option. Even though gold is viewed as the most secure option for investing, it necessitates a significant investment. Because of this, with small investors in mind, the government has provided the opportunity to invest in gold through gold funds and gold ETFs. This investment is not directly related to gold, but the returns are equivalent. Today, we are providing details on whether investing in gold funds or gold ETFs is a more advantageous choice.
What exactly is Gold Fund?
Investing in gold funds is similar to investing in mutual funds, with regular monthly SIP and lump sum investments being made. You have the option to cash in the gold fund at any time and you can begin with an investment as low as Rs 1000.
What do Gold ETFs entail?
Gold ETFs are funds traded on the stock exchange that invest in companies’ stocks. This is how investment decisions are taken. Investing in gold ETFs necessitates having a Demat account. You have the option to cash it based on the stock market’s timing.
What advantages do Gold Funds and Gold ETFs offer for investors?
When examining the performance of gold funds and gold ETFs over the past year, SBI Gold Fund recorded a 100% return, while ICICI Pru Regular Gold Savings Fund achieved a return of 21.65%. Conversely, gold ETFs have yielded an average gain of 21.94 percent. Over the past year, both gold-based mutual fund categories have produced comparable average returns.
Specialists recommend that gold funds are appropriate for investors seeking systematic and long-term flexibility, while gold ETFs are perfect for investors with demat accounts or those interested in diversification.
