Zerodha Mutual Fund lists Gold ETF on exchanges: Should you invest

According to data from the Association of Mutual Funds in India (AMFI), Gold Exchange Traded Funds witnessed an increase in inflows, reaching ₹657 crore in January 2024, marking a seven-fold rise compared to the previous month.

Zerodha Mutual Fund emphasised the cost-effectiveness of its Gold ETF, stating that it provides an easy and low-cost avenue for investors to add gold exposure to their portfolios.

The fund invests in physical gold with a purity level of 99.5% and above, securely stored in a vault to address any security concerns.

Gold has long been recognised as a safe haven and a hedge against inflation, factors that continue to drive its appeal in the face of ongoing geopolitical tensions and rising inflation, especially in the United States.

The introduction of the Zerodha Gold ETF offers investors a way to diversify their portfolios and potentially reduce overall volatility.

The Zerodha Gold ETF is accessible to a wide range of investors, with a minimal investment requirement of ₹10.

Commenting on the launch, Vishal Jain, CEO of Zerodha Fund House, said, “Gold is typically viewed as a financial asset that maintains its value and purchasing power during Inflationary periods. The Gold ETF offers a simple and efficient way for people to invest in gold without the concern of storage and security. As gold has a low correlation with equity, it reduces the overall volatility of your portfolio."

While the launch of Zerodha Gold ETF may provide investors with an option to diversify their portfolios, experts suggest that gold is better as a short to medium-term investment.

The fund house further reminded investors that mutual fund investments are subject to market risks, urging them to carefully read all scheme-related documents before making any investment decisions.