Gold ETFs register `300 crore outflow in April-August period
12 Sept 2017 11:21 PM IST
New Delhi: Gold exchange traded funds (ETFs) continued losing sheen as an investment class with investors pulling out over Rs 300 crore from the instrument in April- August of this fiscal, preferring equities over them.
Trading in gold ETF segment has been tepid during the last four financial years. It has witnessed outflows of Rs 775 crore in 2016-17, Rs 903 crore in 2015-16, Rs 1,475 crore in 2014-15 and Rs 2,293 crore in 2013-14.
On the other hand, equity and equity-linked saving scheme (ELSS) saw an infusion of more than Rs 61,000 crore during the first five months (April-August) of the current financial year. This included an investment of over Rs 20,000 crore in last month alone.
Stock markets have been on an upswing, touching new highs this year.
According to Vidya Bala, head of MF Research at Fundsindia.com, gold is losing steam as an investment asset class due to gradual rate hike in the US and a possible squeezing in Europe by 2018.
"This is because, when debt as an asset delivers higher yields, gold, which has no underlying fundamentals, tends to under perform," she said.
According to the latest data available with Association of Mutual Funds in India (Amfi), a net sum of Rs 314 crore was pulled out in 14 gold-linked ETFs during April-August period of the ongoing financial year, as compared to Rs 462 crore in the same period of the last fiscal.
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