Gold exchange traded funds (ETFs) rose nearly 3% on Thursday, August 20 after the bullion marked its biggest gain in six months after the US Treasury Department unexpectedly announced to increase buybacks of long-dated government debt.
Among gold-traded funds, ICICI Prudential Gold ETF and Zerodha Gold ETF advanced 2.7% to Rs 133.7 and Rs 24.57, while Kotak Mutual Fund - Gold Exchange Traded Fund rose 2.6% to Rs 117.95.
Gold ETFs are exchange traded funds that track the price of the physical gold. They are a proxy way of investing in the precious metal, without the need to physically store it. There are 25 schemes available in India.
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The latest surge in Gold ETFs come as the bullion trades near $4500 after US government bond yields dropped as the Treasury announced surprise liquidity injection, a tailwind for the precious metal.
US Treasury said it's increasing buybacks of long-dated government debt, indicating that the US wants to lower borrowing costs after yields hit multi-decade highs. A significant jump in 30-year bonds pushed yields lower while the dollar weakened, advancing bullion price nearly 4%.
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Top Gold ETFs
In terms of six month returns, the Wealth Company Gold ETF topped with a return of 1.42%, followed by Tata Gold ETF and Mirae Asset Gold ETF with 1.38% returns. 360 ONE Gold ETF posted 1.37% returns, while Bandhan Gold ETF recorded 1.31% returns, according to data collected from Groww.
Most gold ETFs delivered returns in the range of 50% to 55% over one year. According to data available, Aditya Birla Sun Life Gold ETF gave highest return of 53.25%, followed by Quantum Gold ETF and UTI Gold Exchange Traded Fund with returns of 53.18%. ICICI Prudential Gold Exchange Traded Fund delivered 53.14% returns.
DSP Gold ETF posted 53.01% in one year and HDFC Gold ETF recorded 52.98% returns. In terms of other funds leading the six-month tenure, Mirae Asset Gold ETF recorded ranked highest with a return of 52.87%, followed by Tata Gold ETF with 52.86%, while 360 ONE Gold ETF gave 52.03% returns.
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