Amid the gloom in the equity market, gold Exchange Traded Fund (ETF) is the only asset class which has been giving glittering returns as high as 36 per cent for the last six months.
"Since the beginning of the global financial meltdown in mid-September, gold ETF has given return of about 36 per cent," said UTI Mutual Fund Head of Products R Raja.
In the past one year, the gold ETF from UTI Mutual Fund gave a return of about 29 per cent, he said.
With most of the asset classes giving negative returns, investment demand for gold is rising, he said adding, the fact is justified by increase in asset under management.
Assets in such exchange-traded funds in February rose 1.8 per cent to Rs 781 crore, he said.
Returns on the five gold ETFs increased by 6 per cent during the month as the yellow metal touched a new high.
Launched in 2007, Gold ETFs are managed by five fund houses including Benchmark Asset Management, UTI Mutual Fund, Kotak Mahindra Mutual Fund, Reliance Capital Asset Management and Quantum Mutual Fund.
Elaborating on the investment in such instrument Raja said it is hedge against volatility in the equity market.
Besides, with the ETFs there is also no problem of storage unlike in the case of physical gold as its ownership is recorded electronically, he added.
