Gold ETF’s are special type of ETF’s (Exchange traded funds) , ETF are not covered here , but view them as open ended mutual funds , which are traded on stock exchange just like normal stocks. You can buy units on Stock Exchange , each unit is equivalent to one gram of gold or .5 grams of gold.
So if you want to invest in 100 grams of gold , you can buy 100 units of a GOLD ETF from stock exchange , you can buy it just like any share from stock exchange.
Gold ETF’s price changes real time , as they are traded on stock exchange like shares.
In India currently there are Five Gold ETF’s.
- Benchmark Gold ETF (Stock Code on NSE/BSE : GOLDEX ) (the first one in country)
- UTI Gold ETF (Stock Code on NSE/BSE : UTGOLD )
and other 3 from Reliance , Quantum and Kotak listed on NSE.
Gold has returned 38% in last 1 year and 170% in last 5 years (absolute). And it looks great in future.
You can easily enter and exit from GOLD ETF’s unlike physical gold.