Gold ETFs are traded on the various stock exchanges in India, where you can buy and sell them. They are just like shares, where you can place an order through your broker and hold them.
You may need to first do the following:
a) Open a Demat Account
You first need to open a demat account, if you do not have one. In case you have one which you are holding shares, you can use the same one. There is no need to open a separate demat account.
b) Open a Trading Account
You need to open a trading account, if you do not have one. Once you have opened the same, you need to login and place an order just as you do for shares and NCDs.
As soon as you login to your account, do the following:
1) Go to the buy and sell
2) Click the scrip code. For example, if you want to buy Axis Gold then just type the word. From the dropdown list you can then select Axis Gold.
3) Click to confirm your order
4) Do the same when you want to sell The above is not an exhausted list and investors, they more or less tell the story of Gold ETF performance in the last one year.
|Name||Returns in last one year|
|GS Gold ETF||-11.5 per cent|
|SBI Gold Exchange Traded Fund||-11.6 per cent|
|Axis Gold ETF||-11.6 per cent|
|Quantum Gold Fund||-11.60%|
|Birla Sun Life Gold ETF||-15.40%|
|Motilal Oswal Most Shares Gold||-12.10%|
|Kotak Gold ETF||-11.6 per cent|
|Can Gold Exchange Traded Fund||-13.4 per cent|
Should You Buy Gold ETFs?
Gold ETFs track gold prices. So, if you want to make money in Gold ETFs, you should largely be able to figure out where gold prices are headed. As can be seen that Gold ETFs have hardly made any money in the last one year. Gold ETFs track gold prices in India. So, when gold prices globally fall, Gold ETFs move in tandem.
In the last few years, gold prices have hardly gained ground. In fact, gold prices have fallen sharply as economic activity through the globe continues to gather momentum.
When economic growth across the globe rises, there is a tendency for gold prices to fall, as the precious metal is largely considered as a safe haven instrument.
In the last few years gold has not given any returns. For it to rise there must be economic chaos or geo-political tensions around the globe.
The precious metal is a safe haven instrument, which means it thrives under chaos. We do not see that happening in the next few years, which is why gold is not an attractive instrument at the moment.
This may not be the right time to invest in gold exchange traded funds. Investors who are holding the precious metal may continue to do so, since they are already incurring losses, if they have invested in the last two years.