ICICI Prudential MF launches gold ETF | Value Research This exchange traded fund will try to capitalise on the growing investment demand for gold within the country
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ICICI Prudential MF launches gold ETF

With the global economic environment once again turning bleak because of the European sovereign debt crisis, gold, the ultimate safe-haven investment, has once again found favour with investors. It is currently trading at around Rs 18,825 per 10 gram. To capitalise on the growing investment demand for gold, ICICI Prudential Mutual Fund has launched ICICI Prudential Gold Exchange Traded Fund. It is an open-ended exchange traded fund (ETF). The new fund offer is open for subscription from June 30 to July 29, 2010. The ETF will list on both the National Stock Exchange and the Bombay Stock Exchange.

Besides acting as a safe-haven investment, gold also acts as a hedge against inflation, which is currently high in India. The yellow metal has registered a compounded annual growth rate of 16.4 per cent and 24.6 per cent over the 10-year and five-year horizon respectively.

No entry or exit load will be applicable as the fund will list on the exchanges. The price of gold, as derived from the LBMA (London Bullion Market Association) AM fixing price, will serve as the benchmark index for the fund. The minimum application amount is Rs 5,000.

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