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.
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.
ALSO READ: Gold Holds Near $4,500 As US Treasury Buyback Sends Yields Lower
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