Top 5 Gold ETFs In October, According To Company Market Capitalizations

Gold Exchange Traded Funds (ETFs) are like company stocks; one can purchase these from a mobile mutual fund app, through a Demat account. It is a virtual mode of gold investment, popular among investors who do not want to worry about storage costs, and making charges on physical gold jewelleries. These are lucrative opportunities to invest in gold, with far lower costs, than gold jewelleries. However, a Gold ETF derives its value from the current gold rates and the stocks of gold-related companies. Then why different gold ETFs are priced differently? And how can one decide where to invest in gold ETFs?

Market capitalizations

One should research wisely before investing in any portfolio considering the company's market capitalization. The way one analyses the Asset Under Management (AUM) for the mutual fund, is the same conception for gold ETF. A better market capital will give you a security of easier liquidity, better numbers of daily trades, and certainly more assurance. For example, if the gold rates are suddenly down and you want to sell your gold ETF, you might face some difficulties in the case of companies with lower market capitalizations. Because the company might fail to provide enough security or backup to your gold ETF. The price of a unit or the NAV of a gold ETF will vary depending on the company and it will also vary upon the amount of gold. If the NAV is lower that certainly means you will be holding a lower amount of gold, and vice versa. So, a lower NAV does not mean that this gold ETF is inadequate than others.

Top 5 gold ETFs

The top 5 gold ETFs in October 2021 are SBI Gold ETF, Birla Gold ETF, HDFC Gold ETF, UTI Gold Share, and Nippon ETF Gold, in terms of company market capitalizations. NAV of the gold ETF is highest for the SBI Gold ETF, and the Birla Gold ETF because they offer a higher amount. However, concerning the market capitalization, SBI has always stayed on top with around Rs. 317.10 crore level, as of October 5. hence, even if the SBI gold ETF unit cost is higher than other funds, investors are inclined towards this fund. Investors lookout for companies with at least more than Rs. 3 crore market capitalization for gold ETF, and compared to that, SBI Gold ETF is in a far better position. On the other hand, HDFC gold ETF has also given good returns considering the last 52 weeks' high and price change.

SBI Gold ETF

SBI Gold ETF's market capital has been Rs. 316.40 crore, and the last unit price was Rs. 4140.85.

Birla Gold ETF

Birla Gold ETF's market capital has been Rs. 96.32 crore, and the last unit price was Rs. 4225.

HDFC Gold ETF

HDFC Gold ETF's market capital has been Rs. 6.37 crore, and the last unit price was Rs. 41.38.

UTI Gold Share

UTI Gold Share's market capital has been Rs. 5.68 crore, and the last unit price was Rs. 40.95. Among all of these 3 gold ETFs, this fund has been in the best position considering its returns on October 6, at 0.17% than yesterday.

Nippon ETF Gold

Nippon ETF Gold's market capital has been Rs. 4.14 crore, and the last unit price was Rs. 40.35.

(Figures as of October, 6, 9.43 AM)

Gold is concerned as a hedge against investment and it is recommended to have around 15% gold investment to diversify the risk of your portfolio. Considering this, gold ETFs are one of the best options for gold holding to have good long-term returns.