Page 5 - Gold Etfs

Gold ETFs losing sheen as equity ETFs glitter

Domestic investors are shying away from taking gold exposure via exchange traded funds (ETFs), but the popularity of equity ETFs is soaring, monthly flow data provided by sectoral body Amfi shows. Gold ETFs have seen net outflows every month, barring April, with a net outflow tally of Rs 1,371 crore for the year so far. On the other hand, equity ETFs continue to see encouraging flows, month on month. In the first nine months of 2016, equity ETFs have seen net inflows of Rs 16,400 crore compared to around Rs 2,120 crore during the same period last year. ETFs are passive investment products, which track an underlying security, such as gold, or a basket of securities such as bank index. For instance, the Nifty 50-based ETF, the most popular in the equity segment, mimics the performance of the Nifty 50 index. In the developed world, ETFs are popular investment vehicles given their low costs, and the trend is catching in India, experts say. ETFs tied to gold are losing interest as investors