Gold Etf Report

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INTRODUCTION
















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Executive Summary

Exchange Traded Funds (ETFs) are mutual fund units which investors buy/sell

from the stock exchange, as against a normal mutual fund unit, where the investor

buys /sells through a distributor or directly from the AMC. Practically any asset

class can be used to create ETFs. Globally there are ETFs on Silver, Gold,

Indices. Gold ETFs are a special type of ETF which invests in Gold and Gold

related securities. Investors can buy G-ETF units from secondary markets either

from the quantity being sold by the APs or by other retail investors. Retail

investors can also sell their units in the market. Exchange Traded Funds (ETFs)

are open ended mutual funds that are passively managed and most of them seek to

mirror the return of an index, a commodity or a basket of assets. ETFs are listed

and traded on stock exchanges like stocks. They enable investors to gain broad

exposure to indices or defined underlying asset (commodity) with relative case,

on a real-time basis, and at a lower cost than many other forms of investing. Gold

backed Exchange Traded Funds (ETFs) are securities designed accurately to track

the gold price. ETF liquidity is supported by large professional market makers

and dealers, in the normal way of providing liquidity on the relevant stock

exchange. Additionally there is the facility to create and redeem new units - on

demand.


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Introduction

ETFs are just what their name implies: baskets of securities that are traded, like

individual stocks, on an exchange. Unlike regular open-end mutual funds, ETFs

can be bought and sold throughout the trading day like any stock. Most ETFs

charge lower annual expenses than index mutual funds. However, as with stocks,

one must pay a brokerage to buy and sell ETF units, which can be a significant

drawback for those who trade frequently or invest regular sums of money.

Exchange Traded Funds (ETFs) are open ended mutual funds that are passively

managed and most of them seek to mirror the return of an index, a commodity or

a basket of assets. ETFs are listed and traded on stock exchanges like stocks.

They enable investors to gain broad exposure to indices or defined underlying

asset (commodity) with relative case, on a real-time basis, and at a lower cost

than many other forms of investing.

Gold ETFs provided investors a means of participating in the gold bullion market

without the necessity of taking physical delivery of gold, and to buy and sell that

participation through the trading of a security on stock exchange. Gold ETF

would be a passive investment; so, when gold prices move up, the ETF

appreciates and when gold prices move down, the ETF loses value. Gold ETF

tracks the performance of Gold Bullion. Gold ETFs provide returns that, before

expenses, closely correspond to the returns provided by physical Gold. Each unit

is approximately equal to the price of 1 gram of Gold. But, there are Gold ETFs

which also provide a unit which is approximately equal to the price of ½ gram of

Gold. They first came into existence in the USA in 1993. It took several years for

them to attract public interest. But once they did, the volumes took off with a

vengeance. Over the last few years more than $120 billion (as on June 2002) is

invested in about 230 ETFs. About 60% of trading volumes on the American

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Stock Exchange are from ETFs. The most popular ETFs are QQQs (Cubes) based

on the Nasdaq-100 Index, SPDRs (Spiders) based on the S&P 500 Index,

iSHARES based on MSCI Indices and TRAHK (Tracks) based on the Hang Seng

Index. The average daily trading volume in QQQ is around 89 million shares.

Their passive nature is a necessity: the funds rely on an arbitrage mechanism to

keep the prices at which they trade roughly in line with the net asset values of

their underlying portfolios. For the mechanism to work, potential arbitragers need

to have full, timely knowledge of a fund's holdings.



History

Deregulation of Gold in India

In India goldsmiths are usually men, and are referred to by a variety of names

depending on the region. In the Vedic period (Second Millennium BC),

goldsmiths had a much higher standing in society than most other artisans,

probably because they worked with a precious metal. The goldsmiths enjoyed

royal patronage. Historical evidence suggests that Indian jewellers had early

mastery of the various skills required to make fine jewellery, such as mixing

alloys, moulding, setting stones, inlay work, relief, drawing gold and silver into

fine wires, plating and gilding. The duties of the goldsmith have been defined in

an ancient social code, but are observed more by breach than by adherence. There

is hardly any village or town, even in the remote corners of the country, where

there is no goldsmith.


Gold Economy

Today, the gold jewellery industry is fast-growing, with impressive domestic and

export sales. Gems and jewellery constitute one of the fastest growing export

sectors in India, accounting for one-fifth of the aggregate exports. The current
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size of the gold economy is around US$ 6 billion and employs over half a million

people. The number of gold jewellery manufacturing units is put at 100,000.

Also, a large number of skilled goldsmiths/gold merchants from India are

engaged in gold trade and industry in almost all the oil-rich Middle Eastern

countries. However, for a long time in the existence of the gold economy, the

producers and consumers of gold jewellery hardly found a place in any policy

discussion on gold.


Economic Reform and Gold

The reform process triggered by the balance of payment crisis in 1990-91 resulted

in a review of important external sector policies of the post-independence era.

The restrictive policy on gold achieved very little in terms of its stated objectives.

Large quantities of gold were routinely smuggled into India and the nexus

between gold smugglers, the so-called hawala operators, and perpetrators of high-

profile crimes became common knowledge.The smuggling operation was so

extensive that a few professional salvage companies in he west had looked at the

lucrative prospect of salvaging substantial quantities of jettisoned gold lying in

the seabed off the west coast of India.

The first major policy reversal in respect of gold came in the form of repeal of the

Gold (Control) Act, 1968 in 1990. Subsequently, the provisions of the Foreign

Exchange Regulation Act (FERA), 1973 (the successor legislation to FERA

1947) relating to gold were also repealed in 1993. The FERA treated gold and

silver on the same footing as foreign exchange for exchange control purposes.

Also, it empowered the federal government to impose curbs on

use/disposal/dealings in gold and silver priorto or at the time of their import into

India. More than an admission of failure to meet any of the prime objectives

pursued in respect of gold, these steps symbolized a more realistic and a less
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ideologically charged approach toward gold.

It is interesting to note that long before the advent of the reform in 1990-91,

the gold control policy of the government was reviewed from time to time by

committees appointed for this purpose, looking critically at most of the important

aspects. One such exercise undertaken in 1978 examined the core restrictions of

the Gold (Control) Act 1968 and recommended various relaxations. It also

examined the question of issuance of more gold bonds by the government, but

came out against this on the grounds that it would be inconsistent with the

government‟s policy to encourage financial assets other than gold. Gold came

under policy focus and much media attention in the fall of 1991, when gold stocks

of around 65 tonnes, (taken from the RBI as well as the government stocks) were

taken out of the country for raising short-term foreign currency resources to tide

over immediate external payment difficulties. Although this move came in for a

lot of political criticism, with some equating it with „mortgaging national honour,‟

most academics and policymakers saw in it a golden opportunity to make a fresh

start on gold.

Gold Market in India

The gold market in India is predominantly a market for buying and selling

physical gold. In the wholesale segment, nominated agencies are the bulk

importers. This market is reasonably efficient from the point of view of

distribution of bars and scraps over the length and breadth of the country, which

takes place in a very effective manner. Price uniformity is also generally

observable in areas with identical incidence of duties and tax.

Gold lending/leasing volumes are small in comparison to physical buying and

selling. Most of the leasing activities are undertaken by nominated banks on a

back-to-back basis via supply from overseas. Domestic lending resources are still

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meagre, as mentioned before. This segment of the market needs to develop for at

least two reasons:

 To provide working capital at low cost together with gold price
hedging, not only to the exporters but also to jewellery
manufacturers for the domestic market. At present, non-exporters do
not receive the necessary working capital finance in rupees from the
banking system. The evidence of the significant contribution made by
the spread of gold leasing, even to small family jewellery units, in
boosting exports and local sales in Italy could provide guidance in the
matter.
 The existence of a gold lending/leasing market is a pre-condition
for arbitrage-free pricing of gold forward/swap contracts in the local
market.
Why should an investor invest in Gold ETF?

 No worry on adulteration

 Gold provides diversification to the portfolio

 Gold is considered as a Global Asset Class

 Gold is used as a Hedge against Inflation

 Gold is considered to be less volatile compared to equities

 Held in Electronic Form

 Store of value

 Extremely Liquid

Advantages of Investing in Gold ETFs

 Potentially cheaper to have price exposure to gold price as compared to

other available avenues

 Quick and convenient dealing through demat account

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 No storage and security issue for investors

 Transparent pricing

 Taxation of Mutual Fund

 Can be traded on stock exchange like buying / selling a stock

 Ideal for retail investor as minimum lot size to trade is one unit on

secondary market







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OBJECTIVE
OF STUDY













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Objective of Study


 TO know the awareness and Popularity of Gold ETF in Public.
 To know the variance between different Gold ETFs.
 Analysis of Gold ETFs
 To provide an insight into the concept of Gold ETF and to study the benefits of
investing in them.
 To ascertain the difference between Gold ETFs and Mutual Funds.4)
 To conduct a primary study to find out the awareness of the Gold ETF among
invest or sand to ascertain the investment behavior relating to Gold ETF and other
investment options in India




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GOLD ETF
FUNDS IN
INDIA








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Gold ETF Funds in India


1. Benchmark Gold ETF (GOLDBEES) lists on NSE

Benchmark Assent Management Company, a Mumbai-based mutual fund house,

has listed India's first gold exchange traded fund (EFT) Gold BeES on the

National Stock Exchange Feb 07. Listed at rs. 950 per gram BeES soon gained

momentum with price surged to Rs 1104 but slumped due to profit booking to Rs

947 within an hour of the launch. Allotment price, however, remained at Rs 945.7

pergram.


The trading unit for BeES has been fixed at one gram with a tick size of one

paisa. This instrument offers only trading and holding it in DMAT account and

not the physical delivery of gold. "Gold BeES, like any other mutual fund

instrument, would attract common men to save in small quantity with a minimum

possible monthly balance of Rs 1000 (roughly equivalent to the price of one gram

gold BoES) which, if continued, may accumulate over a period of time to give

handsome amount on the occasions like daughter's wedding or higher education

of their child," A P Kurian, chairman, AMFI said.


He further added that the New Year was adding a new benchmark in the history

of mutual funds with the addition of BeES to the securities portfolio. Looking at

the success of gold exchange traded funds in the countries like the US, South

Africa and Australia which has created an asset of about $12 billion, this

production in India is all set to attract good amount of retail participation from the

common man, Kurian said.


Gold BeES is designed to provide returns that, before expenses, closely

correspond to the returns provided by physical Gold. Each unit is approximately

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equal to the price of 1 gram of Gold.
Entry Load Slabs will be as below:
 Rs. 10,000 to Rs. 49,99,000 - 1.5%
 Rs. 50,00,000 to Rs. 1,99,99,000 - 1.0%
 Rs 2,00,00,000 to Rs 4,99,99,000 - 0.5%
 Rs. 5,00,00,000 and above - Nil
There will be no exit load charge by the Fund The total expense ratio will be
maximum of 1% per annum. Since Gold BeES is classified under Mutual Fund,
investor investing in this need not pay Wealth Tax. The scheme will have Non
equity Mutual Fund taxation, applicable as per current Tax laws, which investor
has to pay after redemption.

2. UTI GOLD Exchange Traded Fund
UTI Gold Exchange Traded Fund is an open ended exchange traded fund. The
investment objective of the scheme is to endeavor to provide returns that, before
expenses, closely track the performance and yield of Gold. However the
performance of the scheme may differ from that of the underlying asset due to

tracking error.

Issue Open 01-Mar-2009

Issue Close 16-Mar-2009

Scheme Objective

Mutual Fund Family

UTI Asset Mgmt Company Pvt. Ltd.

Fund Class

Gold

Fund Type

Open-Ended

Investment plan

Dividend

Fund Manager

Swati Kulkarni

Entry Load

0.00 %

Exit Load

0.00 %

Comment

None


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A gold ETF was eagerly awaited by US investors. Now, there are two to choose

from. One is IAU from Barclay's Global Investors. The other is GLD from State

Street.

State Street's started trading first and has managed to capture a larger slice of the

market. In February, the GLD ETF held $6 billion worth of assets. However, both

should be equivalent bets for those looking to invest in gold. In its first three days

of trading, GLD traded roughly 30 million shares and nearly all of that has been a

new buyer if you believe the press for one, am not interested in holding too much

of this particular asset class. Why? Because gold has no real use in the world.

Sure, it is admired and hoarded by people across the globe, but it doesn't generate

value on its own. Warren Buffet said it best, "I would rather own assets that

produce value. Dow went from 66 to 12000 and paid dividends. If you owned

Gold you paid 20 and went to 400 a hundred years later."

However some investors are attracted since gold is likely to increase in value

when other areas of the market are suffering. As such, it is used as hedge against

other investments. Regardless, I prefer to invest in the long-term returns that

company stocks and bonds offer. This isn‟t to say that I don‟t own any gold. In

fact, the commodities ETF that have is 10% gold.

Note that gains from the gold ETF will be taxed at the collectibles rate of 28% vs.

the long-term capital gains rate of 15%. If you're going to invest in this ETF, you

might want to consider using a tax deferred account. And since gold doesn't

produce income, partial shares of your holdings will be sold to pay for

management fees.






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3. Kotak Gold Exchange Traded Fund

Investment Objective: the investment objective of the scheme is to generate

returns that are in line with the return on investment in physical gold, subject to

tracking errors.



Type of fund: Kotak Gold ETF is open ended fund. The ongoing of the scheme

commenced from August 8, 2007. The fund creates/redeem the scheme units in

large size known as creation unit. The value of unit is 1000 gram of physical gold

or multiple thereof called as the portfolio deposit and a cash component which

will be exchanged for corresponding number of units. The portfolio deposit and

cash component may change from time to time and will be announced by fund on

its website.

Issue Open 01-july-2009

Issue Close 08-Aug-2009

Scheme Objective

Mutual Fund Family

Kotak mahindra Asset Mgmt Company

Pvt. Ltd.

Fund Class

Gold

Fund Type

Open-Ended

Investment plan

Dividend

Fund Manager

Mr. Abhishek Bisen

Entry Load

0.00 %

Exit Load

0.00 %

Comment

None


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Indemnity is a legal exemption from the penalties or liabilities incurred by any

course of action. Some of the risk factors listed in the prospectus are · the loss,

damage, theft or restrictions on access to the Trust's gold · the lack of adequate

sources of recovery if the Trust's gold is lost, damaged, stolen or destroyed,

including a lack of insurance · the failure of gold bullion allocated to the Trust to

meet the London Good Delivery Standards · the failure of sub-custodians to

exercise due care in the safekeeping of the Trust's gold · the limited ability of the

Trustee and the Custodian to take legal action against sub-custodians; · the

insolvency of the Custodian · the Trust's obligation to reimburse the Purchaser

and the Market Agent for certain liabilities in the event the Sponsor fails to

indemnify them · the lack of experience of the Sponsor and its management in

operating an investment vehicle such as the Trust · competing claims over

ownership of intellectual property rights related to the Trust.

4. Reliance Gold Exchange Traded Fund

Reliance Gold Exchange Traded Fund (RGETF) is an open ended Gold Exchange

Traded Fund which will track the performance of Gold Bullion. The units issued

under the scheme will represent the value of gold held in the scheme. It is

designed to provide returns that, before expenses, closely correspond to the

returns provided by domestic price of Gold. Gold ETF is a security listed on the

stock exchange available for trading with an intention to offer investors a means

of participating in the gold bullion market without the necessity of taking physical

delivery of gold.

Product Features Type: An open-ended Gold Exchange Traded Fund that tracks

the domestic prices of gold through investments in physical Gold.

Investment Objective: The investment objective is to seek to provide returns that
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closely correspond to returns provided by price of gold through investment in

physical Gold (and Gold related securities as permitted by Regulators from time

to time). However, the performance of the scheme may differ from that of the

domestic prices of Gold due to expenses and or other related factors.

Options: Only Dividend Pay-out Option

Minimum Application Amount

On going purchase directly from mutual fund would be available only to the

Authorized Participants provided the value of units to be purchased is in creation

unit size. Authorized Participants may buy the units on any business day for the

scheme directly from the mutual fund at applicable NAV and transaction charges,

if applicable, by depositing Gold or cash, value of which is equal to creation size.

Each creation unit consists of 1000 units and cash components, if any, of Reliance

Gold Exchange Traded Fund.

RGETF units will be credited to the unit holders demat account on the date of

realization of instrument, at the applicable NAV.

The AMC will appoint Authorized Participants to provide liquidity in secondary

market on an ongoing basis. The Authorized Participants would offer daily two

way quote in the market.

Modes of payment for subscriptions & redemptions during NFO &

continuous offer with the AMC

During NFO all the subscriptions will happen by cash (by issuing a cheque / DD)

however during continuous offer the transactions with the AMC by Authorized

Participants & Large Investors can happen by issuing a cheque / DD or by

transferring requisite gold (as per LBMA Good Delivery Norms referred in the

Offer Document) to the fund‟s Designated DP account (in the form of Portfolio

Deposit) while the balance Cash Component, if any has to be paid to the AMC.

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Please refer to the offer Document for further details.

Allotment Price

Allotment price will be equal to the face value of Rs100/- plus premium

equivalent to the difference between the face value and price of one gram of

gold on the date of allotment

For example :
If on the date of allotment the price of 10 gm of gold is 9000, then the allotment price becomes

as follows;
Rs 100 + premium equivalent to the difference between the face value and price
of one gram of gold on the date of allotment.
i.e Rs 100 + Rs (900-100) = Rs 900 approx

(The above example is for illustration purpose and does not include the expenses

of the scheme)
Purity of Gold
All gold bullion held in the scheme‟s allocated account with the custodian shall

be of fineness (or purity) of 995 parts per 1000 (99.5%) or higher.
Load Structure: During NFO and Continuous Offer

Entry Load:


Less than Rs. 1 lacs -



Rs. 1 lacs & less than Rs. 25 lacs



Rs. 25 lacs & less than Rs. 50 lacs



Rs. 25 lacs & less than Rs. 1 crs



Rs 50 lacs & less than Rs 1cr
1.50%



0.75%



0.50%



0.25%



0.25% & NOTRs

25 lacs & less..
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Entry Load: Nil

During continuous offer: Entry & Exit Load: NIL


Listing: The Fund would endeavor to get the units of the Scheme listed on the

National Stock Exchange and / or any other stock exchange(s) as may be decided

by the AMC within 30 days from the closure of the New Fund Offer period.


Liquidity : After the close of the NFO, as RGETF would be listed on the

Exchange, subsequent buying or selling by Unit holders can be made from the

secondary market. The minimum number of Units that can be bought or sold on

the exchange is 1 (one) unit. All investors including Authorised Participants and

large investors may sell their units in the stock exchange(s) on which these units

are listed on all the trading days of the stock exchange. The trading will be as per


the normal settlement cycle.


Alternatively, Authorised Participants and Large investors can directly buy / sell

Units in blocks from the Fund in „Creation Unit‟ size, as defined in this Offer

Document on all working days. Mutual fund will repurchase units from

Authorised Participants and Large investors on any business day provided the

units offered for repurchase is not less than 100 units.

5. Quantum Gold Exchange Traded Fund


The Quantum Gold Fund (QGF) seeks to offer investors an innovative, cost-

efficient and secure way to invest in gold. The QGF is an Open Ended Fund,

which is listed on the National Stock Exchange (NSE) in the form of an Exchange

Traded Fund (ETF) tracking domestic prices of gold. The scheme enables

investors to participate in the gold bullion market without taking physical delivery

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of gold, and to buy and sell units just like a stock on any of the recognized

exchanges where it is listed..


Investment Objective


The investment objective of the Quantum Gold Fund is to provide returns that,

before expenses, closely correspond to the returns provided by the domestic price

of gold.

Scheme Details

Each unit of the QGF will be approximately equal to price of half (½) gram of

Gold. In the New Fund Offer (NFO) period, the Fund will accept cheque or

demand draft. The minimum amount of investment is Rs.5,000/- and in multiples

ofRs.1,000/-thereafter.

After the NFO, the QGF units are listed on the NSE and investors can buy or sell

units just like any equity share. Investors can buy or sell QGF units through

member-brokers on the NSE. The minimum quantity for buying and selling

would be at least 1 unit.

Ongoing Sales/Redemption

On an ongoing basis (after the NFO), direct purchases from the Fund would be restricted to
only Authorized Participants and Eligible Investors. Authorised Participants and Eligible
Investors can buy/redeem in creation unit size and multiples thereof directly from the Fund on
all business days. Retail investors can buy and sell only on the exchange


Creation Unit Size

„Creation Unit Size‟ is the number of QGF units, which is exchanged for the

Portfolio Deposit and cash component. The Portfolio Deposit shall consist of

physical gold of defined purity and quantity, and the cash component represents

the difference between the applicable NAV of units in creation unit size and the
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market value of physical Gold. The facility of creating/redeeming units in

creation unit size will be available only for the Authorized Participants and large

or eligible investors as defined in the Scheme Information Document. The Fund

may from time to time change the size of the creation unit size in order to equate

it with marketable lots of the underlying instruments.

Through the lower cost of operations and the availability of units having smaller

denominations, the Quantum Gold Fund would provide investors an excellent

means of asset allocation. Thus, an investor can buy gold in unit form, with each

unit being approximately equal to ½ gram of Gold, for as low as around Rs. 600

per unit at the current prices. (As on January 9th, 2008) Gold ETFs offer the best

of both worlds. The investor has the advantages of owning physical gold, without

incurring additional expenses and losses like making charges (for gold jewellery),

and bank vault charges (for keeping coins or bars or jewellery). If investors

purchased gold from the retail jeweller or a bank, it would have cost at least a

straight loss to the extent of the premium paid (which usually ranges from 5 to

20%). And there are no concerns of quality or theft– The gold backing the ETF is

certified by the London Bullion Market Association and stored in vaults of the

custodian / sub-custodians. The fund house takes care of all risks of storage and

safety. Buying and selling is very easy. Like any other security, you just buy and

sell it though your broker on the stock exchanges. And unlike your jeweler and

bank, you do not suffer premiums or making charges in the transactions. About

the Quantum Gold Fund. The Quantum Gold Fund is an Open Ended Exchange

Traded Fund (ETF) launched by Quantum Mutual Fund and listed on the NSE. It

will track domestic prices of Gold through investments in physical Gold. How to

purchase and sell Quantum Gold Fund units.



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The Quantum Gold Fund Highlights

Minimum Investments

Minimum target amount during initial offer period


Face value per unit
Rs 5,000 (multiples of 1000)

Rs. 10 Lacs


Rs. 100
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Entry and Exit Load structure

Entry Load

Exit Load

Exit Load
Entry Load Nil

Authorized Participants Nil

Eligible Investors 0.50%
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The load structure is however, subject to change from time to time and such

changes shall be implemented prospectively.

Liquid

Liquid Benchmark Exchange Traded Scheme

Liquid BeES (Liquid Benchmark Exchange Traded Scheme) is the first money

market ETF (Exchange Traded Fund) in the world. The investment objective of

the Scheme is to provide money market returns. Liquid BeES will invest in a

basket of call money, short-term government securities and money market

instruments of short and medium maturities. It is listed and traded on the NSE

Capital Market Segment and is settled on a T+2 Rolling basis. The Fund will

endeavor to provide daily returns o the investors, which will accrue in the form of

daily dividend, which will be compulsorily reinvested in the Fund daily. The units

arising out of dividend reinvestment will be allotted and credited to the Demat

account of the investors at the end of every month. Such units of Liquid BeES

will be allotted and credited daily, up to 3 decimal places.

How ETFs is different from Traditional Mutual Funds


Since ETFs trade like stocks, they offer a degree of flexibility unavailable with

traditional mutual funds. Specifically, investors can trade ETFs intra-day, monitor

price discovery throughout the trading day and employ the usual arsenal of order

types such as limit and stop loss orders-available in single stock trading. In a

mutual fund, by comparison, investors can purchase traditional mutual funds only

at the fund's NAV, which is published at the end of each trading day. (Typically,

orders to buy or sell mutual fund shares must be placed at least an hour or two

prior to market close).

This difference gives rise to an important advantage of ETFs over traditional

mutual funds. Because they are relatively liquid, ETFs are immediately tradable;
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therefore, the risk of price movement between investment decision and time of

trade is substantially less when ETFs are used in lieu of traditional funds. For

example, suppose an investor decides to purchase index exposure at 10.00 A.M.

via a traditional mutual fund and during the balance of the trading day, suppose

the index gains 1%. The investor will miss the opportunity, as he will be able to

purchase the fund only at the day's closing NAV.

The ability to reduce the time between the investment decision and the trade

execution is critical, more so in a volatile market. Delaying a purchase decision

until next day's closing price when a decision was made the previous evening

introduces slippage costs that increase with the range of price moves during the

trading day.

The redemption process is also different for ETFs and mutual funds. While ETFs

are redeemed in-kind (by exchanging basket of shares) as opposed to cash, mutual
fund units are redeemed in cash, as the fund must sell shares in the open market to

meet redemptions.

closed-end funds, which also trade on exchanges, are different from ETFs as they

have a static amount of shares outstanding. For that reason, a close-ended fund

may trade at a premium or a discount to its net asset value for a protracted period

of time. (The vast majority, however, trade at a discount.) Exchange-traded funds,

on the other hand, trade close to the net asset value of the underlying portfolio

since new ETF shares can be created and redeemed.








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CREATIONS AND
REDEMPTIONS















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Creations and Redemptions

ETFs are different from Mutual funds in the sense that ETF units are not sold to

the public for cash. Instead, the Asset Management Company that sponsors the

ETF (Fund) takes the shares of companies comprising the index from various

categories of investors like authorized participants, large investors and

institutions. In turn, it issues them a large block of ETF units. Since dividend may

have accumulated for the stocks at any point in time, a cash component to that

extent is also taken from such investors. In other words, a large block of ETF

units called a "Creation Unit" is exchanged for a "Portfolio Deposit" of stocks and

"Cash Component". The number of outstanding ETF units is not limited, as with

traditional mutual funds. It may increase if investors deposit shares to create ETF

units; or it may reduce on a day if some ETF holders redeem their ETF units for

the underlying shares. These transactions are conducted by sending creation /

redemption instructions to the Fund. The Portfolio Deposit closely approximates

the proportion of the stocks in the index together with a specified amount of Cash

Component. This in-kind creation / redemption facility ensures that ETFs trade

close to their fair value at any given time.

Some investors may prefer to hold the creation units in their portfolios. While

others may break-up the creation units and sell on the exchanges, where

individual investors may purchase them just like any other shares. ETF units are

continuously created and redeemed based on investor demand. Investors may use

ETFs for investment, trading or arbitrage. The price of the ETF tracks the value

of the underlying index. This provides an opportunity to investors to compare the

value of underlying index against the price of the ETF units prevailing on the

Exchange. If the value of the underlying index is higher than the price of the ETF,

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the investors may redeem the units to the Sponsor in exchange for the higher

priced securities. Conversely, if the price of the underlying securities is lower

than the ETF, the investors may create ETF units by depositing the lower-priced

securities. This arbitrage mechanism eliminates the problem associated with
closed-end mutual funds viz. the premium or discount to the NAV.
Applications of ETEs

 Efficient Trading: ETFs provide investors a convenient way to gain
market exposure viz. an index that trades like a stock. In comparison to a
stock, an investment in an ETF index product provides a diversified
exposure to the market. Depending on the index, investors may obtain
exposure to countries/ markets or sectors.
 Equitising Cash: Investors with idle cash in their portfolios may want to
invest in a product tied to a market benchmark like an index as a temporary
investment before deciding which stocks to buy or waiting for the right
price.
 Managing Cash Flows: Investment managers who see regular inflows
and outflows may use ETFs because of their liquidity and their ability to
represent the market.
 Diversifying Exposure: If an investor is not sure about which particular
stock to buy but likes the overall sector, investing in shares tied to an index
or basket of stocks provides diversified exposure and reduces stock specific
risk.
 Filling Gaps : ETFs tied to a sector or industry may be used to gain

exposure to new and important sectors. Such strategies may also be used to

reduce an overweight or increase an underweight sector.
 Shorting or Hedging : Investors who have a negative view on a market
segment or specific sector may want to establish a short position to
capitalize on that view. ETFs may be sold short against long stock holdings
29

as a hedge against a decline in the market or specific sector.



STRUCTURE
OF ETFS















30



Structure of ETFs

Fees

Typically a commission of 0.4% is charged for trading in gold ETFs and an

annual storage fee is charged. U.S. based transactions are a notable exception,

where most brokers charge only a small fraction of this commission rate. The

annual expenses of the fund such as storage, insurance, and management fees are

charged by selling a small amount of gold represented by each certificate, so the

amount of gold in each certificate will gradually decline over time. In some

countries, gold ETFs represent a way to avoid the sales tax or the VAT which

would apply to physical gold coins and bars.


In the United States sales of a gold ETF are treated as sales of the underlying

commodity and thus are taxed at the 28% capital gains rate rather than the 15%

long-term capital gains rate for non-collectibles.


Funds

Exchange Traded Gold

Following the launch of Gold Bullion Securities on 28 March 2003 in Australia, a

number of associated GETFs were soon launched on other stock exchanges.

These GETFs are grouped under the name Exchange Traded Gold.


Exchange Traded Gold is listed under:


In Europe:


 ETFS Physical Gold (previously named Gold Bullion Securities) (ASX:

31

GOLD)

 ETF Securities Gold Bullion Securities (LSE: GBS and Euronext: GBS)

(previously marketed by Lyxor)
In the United States:

 SPDR Gold Trust (formerly streetTRACKS Gold Shares) (NYSE: GLD,

SGX:GLD 10US$, TYO: 1326 and SEHK: 2840)
 New Gold Issuer (JSE: GLD)

Exchange Traded Gold is sponsored by the World Gold Council, and as of

August 2007 held 627.92 tonnes of gold in storage.[3] SPDR Gold Trust

marketed by State Street Global Markets LLC, an affiliate of State Street Global

Advisors, accounts for over 80 percent of this gold. As of 2008, SPDR Gold Trust

is the largest and most liquid GETF on the market.


ETFS Physical Gold

In September 2006 ETF Securities launched ETFS Gold (LSE: BULL) which

tracks the DJ-AIG Gold Sub-Index, and later in April 2007 ETFS Physical Gold

(LSE: PHAU) which is backed by allocated gold bullion.


ETF Securities‟ physical gold ETCs - ETFS Physical Gold (PHAU) and Gold

Bullion Securities (GBS) - are all backed by “allocated” gold bars – uniquely

identifiable bars which carry no bank credit risk. The precious metal bars are held

in trust in London by the Custodian HSBC Bank USA N.A., the world‟s leading

Custodian for ETCs. The metal held with the Custodian must conform to the rules

for Good Delivery of the London Bullion Market Association (LBMA). Securities

are only issued once metal is confirmed as being deposited into the Company‟s

bullion account with the Custodian. Consistent with allocated gold, no precious

metal is borrowed, loaned out nor does it earn any income.
32



As of Jan 09 ETFS Securities is the largest gold ETF provider in europe.
iShares COMEX Gold Trust


The iShares COMEX Gold Trust was launched by iShares on 21 January 2005

and is listed on the New York Stock Exchange (NYSE: IAU) and Toronto Stock

Exchange (TSX: IGT). As of April 28, 2009 the fund held 62.32 tonnes of gold in

storage.


ZKB Gold ETF

The ZKB Gold ETF was launched on 15 March 2006 by Zürcher Kantonalbank

and is listed in Switzerland under the symbol ZGLD. Shares are sold in 1 kg gold

units, with a minimum purchase of one unit. As of August 2007, ZKB Gold ETF

held 22.0 tonnes of gold in storage.


Central Fund of Canada

The Central Fund of Canada (TSX: CEF.A and NYSE: CEF) is a closed-end fund

headquartered in Calgary, Alberta, Canada, mandated to keep the bulk of their net

assets in a mixture of gold and silver with a small percentage of cash. The

custodian of the gold and silver assets is the main Calgary branch of CIBC. As of

March 2008, the Central Fund of Canada held 28.48 tonnes of gold and 1423.66

tonnes of silver in storage.

Central Gold Trust

The Central Gold Trust (TSX: GTU.UN, TSX: GTU.U and NYSE: GTU) is a

closed-end fund operated by many of the same individuals, and employing many

of the same practices, as the Central Fund of Canada. Unlike its sister fund,

however, the Central Gold Trust is mandated to keep the bulk of its assets in gold,

and does not hold silver. As of March 2008, the Central Gold Trust held 5.21 tons
33


of gold in storage.

Gold Benchmark Exchange Traded Scheme

On 19 March 2007 Benchmark Asset Management Company, a Mumbai-based

mutual fund house, launched Gold BeES (NSE: GOLDBEES) on the National

Stock Exchange of India. Shares are sold in approximately 1 gram gold units.


UTI Gold Exchange Traded Fund

On 17 April 2007 UTI Mutual Fund listed Gold Exchange Traded Fund

(NSE: GOLDSHARE) on the National Stock Exchange of India. The objective of

UTI Gold Exchange Traded Fund is to endeavor to provide returns that, before

expenses, closely track the performance and yield of Gold. Every unit of UTI

Gold Exchange Traded Fund approximately represents one gram of pure gold.

Units allotted under the scheme will be credited to investors‟ demat accounts.


Gold-Price-Linked Exchange Traded Fund
On 10 August 2007, Gold-Price-Linked Exchange Traded Fund (code "1328")

listed on the Osaka Securities Exchange, Japan. Shares are sold in 1 gram gold

units, with a minimum purchase of ten units. This GETF is not backed by

physical gold but by special bonds traded in London which are linked to the gold

price.


PowerShares DB Gold ETF and ETNs (PowerShares/Deutsche Bank)


Tracks the performance of certain index moves inside the Deutsche Bank Liquid

Commodity Index - Optimum Yield Gold. ETNs are exchange-traded notes,

which differ from exchange-traded funds (ETFs).




34











COMPARISON













35



Comparison of Gold ETF with Physical Gold


Parameter

Jewelers

Bank

Gold ETF

How Gold is
held

Physical (Bars /
Coins)

Physical (Bars /
Coins)

Dematerialized
(Electronic Form)


Pricing

Differs from one to
another. Neither
transparent nor
standard.


Differs from bank
to bank. Not
Standard.


Linked to International
Gold Prices and very
transparent.

Buying
Premium above
gold price


Likely to be more


Likely to be more


Likely to be less

Making
Charges

Charges are
incurred

Charges are
incurred


No Charges are incurred

Impurity Risk

High

Nil

Nil

Storage
Requirement


Locker / Safe


Locker / Safe


Demat Account

Security of
Asset

Investor is
responsible

Investor is
responsible

Fund House takes
the responsibility

Resale

Conditional and
uneconomical

Banks do not buy
back


At Secondary Market Prices

Convenience in
Buying /
Selling


Less convenient, as
Gold needs to be
moved physically

Less convenient,
as Gold needs to
be moved
physically


More Convenient, as held in
electronic form under the
demat account

Quantity to
Buy / Sell

Available in
standard
denomination

Available in
standard
denomination


Minimum is ½ or 1
gram according to the
fund

Bid Ask
Spread


Very High


Can‟t Sell Back


Very Low

Risk of Theft

Yes, possible

Yes, possible

No, Not possible

Wealth Tax

Yes

Yes

No

Long Term
Capital Gains
Tax


Only after 3 years


Only after 3 years


After 1 year


36






RESEARCH
METHODOLOGY


















37

RESEARCH METHODOLOGY
 Secondary Data

I. SKEWNESS
Skewness describe asymmetry from the normal distribution in a set of statistical

data. Skewness can come in the form of "negative skewness" or "positive

skewness", depending on whether data points are skewed to the left (negative

skew) or to the right (positive skew) of the data average.

Negative skew: The left tail is longer; the mass of the distribution is concentrated

on the right of the figure. It has relatively few low values. The distribution is said

to be left-skewed.

Positive skew: The right tail is longer; the mass of the distribution is concentrated

on the left of the figure. It has relatively few high values. The distribution is said

to be right-skewed.















Source- Skewness - Wikipedia, the free encyclopedia.htm

Skewness is extremely important to finance and investing. Most sets of data,
including stock prices and asset returns, have either positive or negative skew
rather than following the balanced normal distribution (which has a skewness of
zero). By knowing which way data is skewed, one can better estimate whether a
given (or future) data point will be more or less than the mean .Most advanced
economic analysis models study data for skewness and incorporate this into their
calculations. Skewness risk is the risk that a model assumes a normal distribution
of data when in fact data is skewed to the left or right of the mean

38

TABLE- 1.1

Month

Benchmark

UTI

Kotak

Reliance

Quantam

NAV

NAV

NAV

NAV

NAV
Mar-07

945.4541


Apr-07

940.4872

937.3458


May-07

893.4265

893.6763


Jun-07

876.1564

877.0542


Jul-07

880.3478

881.2746

882.3436


Aug-07

887.2831

888.6244

889.5782


Sep-07

935.7657

937.8366

938.2891


Oct-07

973.0185

974.4634

975.7427


Nov-07

1035.861

1037.613

1038.926

1041.069


Dec-07

1031.232

1033.43

1034.26

1027.807


Jan-08

1131.715

1133.995

1135.073

1123.458


Feb-08

1190.288

1192.831

1193.836

1179.419

1236.447
Mar-08

1267.401

1266.205

1270.998

1254.922

1259.423
Apr-08

1179.574

1180.68

1182.541

1165.983

1175.705
May-08

1211.464

1214.134

1158.586

1198.634

1208.373
Jun-08

1230.128

1232.896

1233.496

1216.781

1226.84
Jul-08

1300.312

1303.126

1303.705

1286.13

1296.946
Aug-08

1167.096

1169.524

1173.577

1152.213

1163.65
Sep-08

1215.513

1218.141

1211.857

1198.67

1217.317
Oct-08

1276.098

1272.639

1282.453

1243.208

1270.181
Nov-08

1191.37

1203.437

1203.887

1174.442

1186.89
Dec-08

1285.379

1288.289

1288.67

1233.083

1285.355
Jan-09

1342.77

1339.655

1346.147

1311.78

1339.609
Feb-09

1481.607

1487.818

1490.018

1448.862

1476.716
Mar-09

1522.739

1523.885

1526.056

1483.273

1516.569
Apr-09

1433.229

1434.158

1437.899

1396.233

1428.574
May-09

1440.682

1442.595

1444.074

1404.696

1436.832
Jun-09

1446.332

1449.078

1450.091

1410.565

1443.234
Jul-09

1454.058

1457.173

1457.491

1418.224

1451.348










39



TABLE – 1.2
Return on Gold Exchange traded fund
Month

Benchmark

UTI

Kotak

Reliance

Quantam

Apr-07

-0.00229


May-07

-0.02229

-0.02072


Jun-07

-0.00848

-0.00815


Jul-07

0.002073

0.002085


Aug-07

0.003408

0.003607

0.003546


Sep-07

0.023105

0.023409

0.023153


Oct-07

0.016954

0.016638

0.016999


Nov-07

0.02718

0.02727

0.027249


Dec-07

-0.00195

-0.00175

-0.00195

-0.00557


Jan-08

0.040381

0.04033

0.040394

0.038645


Feb-08

0.021915

0.021968

0.021921

0.021111


Mar-08

0.027262

0.025925

0.0272

0.026949

0.007996

Apr-08

-0.03119

-0.03037

-0.03133

-0.03192

-0.02987

May-08

0.011585

0.012134

-0.00889

0.011994

0.011903

Jun-08

0.00664

0.00666

0.027209

0.006526

0.006587

Jul-08

0.024097

0.02406

0.024042

0.024073

0.024134

Aug-08

-0.04694

-0.04698

-0.04567

-0.04775

-0.0471

Sep-08

0.017653

0.017689

0.01394

0.017167

0.019581

Oct-08

0.021125

0.019008

0.02459

0.015844

0.018462

Nov-08

-0.02984

-0.02428

-0.02746

-0.02471

-0.02945

Dec-08

0.032984

0.02959

0.029556

0.021161

0.034612

Jan-09

0.018971

0.01698

0.018951

0.026869

0.017955

Feb-09

0.042731

0.045557

0.044099

0.043166

0.042319

Mar-09

0.011892

0.010403

0.010379

0.010194

0.011565

Apr-09

-0.02631

-0.02636

-0.02584

-0.02626

-0.02596

May-09

0.002253

0.002548

0.001861

0.002625

0.002503

Jun-09

0.0017

0.001947

0.001806

0.001811

0.001931

Jul-09

0.002314

0.002419

0.002211

0.002352

0.002435

Mean

.006676

.007097

.009082

.006713

.004094

Skewness

-.64859

-.064454

-.81546

-.75956

-.67643

40


II. COEFFICIENT OF VARIATION – CV

A statistical measure of the dispersion of data points in a data series around the

mean. It is calculated as follows:



Coefficient of Variation = Standard Deviation

Expected Return



The coefficient of variation represents the ratio of the standard deviation to the

mean, and it is a useful statistic for comparing the degree of variation from one

data series to another, even if the means are drastically different from each other.

In the investing world, the coefficient of variation allows you to determine how

much volatility (risk) you are assuming in comparison to the amount of return you

can expect from your investment. In simple language, the lower the ratio of

standard deviation to mean return, the better your risk-return tradeoff.

With reference to Table No.1.2

Funds

Benchm

ark

UTI

Kotak

Relience

Quantam

Co-effieients

of variations

3.344704

3.117695

2.560534

3.561133

5.915582


III. ANALYSIS OF VARAINCE (ANOVA)

The Analysis Of Variance, popularly known as the ANOVA test, can be used
in cases where there are more than two groups. When we have only two samples
we can use the t-test to compare the means of the samples but it might
become unreliable in case of more than two samples. If we only compare two
means, then the t-test (independent samples) will give the same results as the
ANOVA. It is used to compare the means of more than two samples. This can
be understood better with the help of an example.

41

Benchmark

gold ETF

UTI GOLD

ETF

KOTAK

GOLD ETF

Reliance

GOLD ETF

Quantum

gold ETF

Quarter

07- 09



NAV

Quarter

07- 09



NAV

Quarter

07- 09



NAV

Quarter

07- 09



NAV

Quarter

07- 09



NAV



1



926.46



1



902.69



1



903.4



1



1064.11



1



1223.8
5


2



881.26



2



902.57



2



1016.3



2



1200.1



2



1244.0
5


3



981.55



3



1015.2



3



1200



3



1233.84



3



1217.0
4

4

1117.7

4

1197.7

4

1191.5

4

1198.03

4

1270.6
1


5


1219.5


5


1209.2


5


1229.7


5


1239.7
6


5


1473.95


6


1232.5


6


1230.3


6


1258.3


6


1442.7
8


6


1443.8


7


1227.7


7


1254.8


7


1454.1


7


1411.1
6



8


1369.9


8


1450.5


8


1444



9


1465.6


9


1441.9


9


1497.2


10


1459.9


10


1495.3




42

Step-1 : Variance Between Colum








N





Sample

mean





Grand

mean





sample mean

- grand mean





(sample mean
- grand mean
) 2


N(sample

mean

- grand mean
)
2

10

1188.202

1234.28

-46.078

2123.182084

21231.82084

9

1210.005

1234.28

-24.275

589.275625

5892.75625

8

1243.844

1234.28

9.564

91.470096

823.230864

7

1255.688

1234.28

21.408

458.302464

3208.117248

6

1312.223

1234.28

77.943

6075.111249

36450.66749


67606.5927

Variance between column =16901.64817

Step-2: variance within column

s1
2


44294.02

10774.22108

s2
2


46939.75

11417.77703

s3
2


40151.62

8681.431351

s4
2


17170.76

2784.447568

s5
2


13342.98

1803.105405



Variance with in column= 35460.98243

Calculated value of F =



=
Variance between column

Variance with in column

16901.6481

35460.9824

44
43


Table Value of f for (4,126 ) degree of freedom & 5 % significance level is 2.45
approx Table Value of f for (4,126 ) degree of freedom & 1 % significance level is
3.32 approx calculated value of F= 0.476627 < Table value So hypothesis accepted

Which specifies that return from all the Gold exchange traded fund are same

they bear no difference.

IV. CORRELATION Matrix:

The study of correlation is of immense use in practical life. Correlation analysis

contribute to the understanding of economic behavior , aids in locating the

critically important variable on which other depend, may revel to the economist

the connection by which distribution spread and suggest to him the paths through

which stabilizing force may become effective. Correlation analysis is based on

the relationship between two or more variables. The degree of relationship

between the variable under consideration is measured through the correlation

analysis. The measure of correlation called coefficient of correlation. It is also

said to be a measure of covariance between two series.


Coefficient of correlation (r) = Cov (X, Y)

Sx Sy

 r = 0 , No relation between X and Y.

 r = 1 , Perfect positive linear relationship.

 r = -1, Perfect negative linear relationship.





44

Benchmark gold ETF


benchmark

gold

Mcx

bsc100

nifty

benchmark

1

0.99964

-0.03745

-0.46234

-0.43995

gold

0.999647

1

-0.04762

-0.46899

-0.4467

mcx

-0.03745

-0.04762

1

0.472066

0.561259

bse-100

-0.46234

-0.46899

0.472066

1

0.97291

nifty

-0.43995

-0.4467

0.561259

0.97291

1

UTI Gold ETF

UTI

gold

mcx

bsc100

nifty

UTI

1

0.999735

-0.0564

-0.49742

-0.47768

gold

0.999735

1

-0.04762

-0.46899

-0.4467

mcx

-0.0564

-0.04762

1

0.472066

0.561259

bse-100

-0.49742

-0.46899

0.472066

1

0.97291

nifty

-0.47768

-0.4467

0.561259

0.97291

1

Kotak Gold ETF

Kotak

gold

mcx

bsc100

nifty

Kotak

1

0.997627

-0.17965

-0.59646

-0.59162

Gold

0.997627

1

-0.04762

-0.46899

-0.4467

Mcx

-0.17965

-0.04762

1

0.472066

0.561259

bse-100

-0.59646

-0.46899

0.472066

1

0.97291

Nifty

-0.59162

-0.4467

0.561259

0.97291

1

Reliance Gold ETF

Reliance

gold

mcx

bsc100

nifty

Reliance

1

0.996905

-0.39414

-0.59054

-0.64952

gold

0.996905

1

-0.04762

-0.46899

-0.4467

mcx

-0.39414

-0.04762

1

0.472066

0.561259

bse-100

-0.59054

-0.46899

0.472066

1

0.97291

nifty

-0.64952

-0.4467

0.561259

0.97291

1

Quantam Gold ETF
Quantam

gold

mcx

bsc100

nifty

Quantam

1

0.9928832

-0.562012

-0.32219

-0.42889

gold

0.9928832

1

-0.04762

-0.46899

-0.4467

mcx

-0.5620122

-0.04762

1

0.472066

0.561259

bse-100

-0.3221971

-0.46899

0.472066

1

0.97291

nifty

-0.4288937

-0.4467

0.561259

0.97291

1


45




ANALYSIS

















46



DATA ANALYSIS & INTERPRETATION
PRIMARY DATA:

Sample Size – 100

Sampling method: convenience sampling

Collected by Questionnaire



Parameters

Out of 100 sample

Awareness of Gold ETF

35 are aware

Preference for Gold ETF

21

Preference for physical gold

79





47



Interpretation:
The above graph shows that all the sampled population invests their savings into some
investment options according to their goals and objectives.


60%
40%
0%
10%
20%
30%
40%
50%
60%
70%
Yes No
Do You Invest Money?
48



Interpretation:
The above graph shows that the majority (around 80 percent) of the sampled
population are not aware about the investment option of Gold ETF.


0
10
20
30
40
50
60
70
Yes No
Are You Aware about Gold ETF?
49



Interpretation:
The above graph shows the investment attitude of investors towards Gold ETF
schemes, it illustrates that most of them do not invest in Gold ETF schemes, this is
primarily due to the lack of awareness about such schemes among the prospective
investors.

0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Yes No
Do You Invest in Gold Etf
50



Interpretation:
The above graph illustrates the investment reasons for investing in Gold ETF. Most of
the investors prefer Gold ETF schemes due factors such as 1) Safety, and 2) Less
Volatility.

9%
9%
9%
37%
9%
18%
9%
Reasons of investing in Gold Etf
Potfolio Diversification
Tradable
Electronic Form
Safety
Better Return
Less Volatility
Others
51



Interpretation:
The above graph shows that the investors primary investment objective is Safety and
Low Risk Return.


0%
5%
10%
15%
20%
25%
30%
35%
40%
Safety Low Risk Return High Risk Return Others
Investment Objective
52



Interpretation:
The above graph shows that majority of the investors have a preference for Fixed
Deposit products on a scale of 1-5 for measurement of investment preference among
various investment alternatives.

0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
A B C D E
Fix Deposit Preference
53



Interpretation:
The above graph shows that the majority of investors prefer Debt Security schemes.



30%
30%
10%
20%
10%
DEBT SECURITY PREFERNCE
A
B
C
D
E
54



Interpretation:
The above graph shows that the majority of investors prefer investing in Mutual
Funds of different types depending upon the scheme and the investors risk bearing
capacity.

20%
50%
10%
10%
10%
Mutual Fund Prefernce
A
B
C
D
E
55



Interpretation:
The above graph shows that the majority of investors prefer investing in Equity shares
of different types of companies depending upon the company, industry profile and
risks involved.

0%
5%
10%
15%
20%
25%
30%
A B C D E
EQUITY PREFERENCE
56



Interpretation:
The above graph shows that the majority of investors prefer investing in Insurance
products and policies of different insurance companies depending upon the policy, the
premium, insurance cover provided, etc












10%
50%
10%
10%
20%
Insurance Preference
A
B
C
D
E
57






RESULT AND
CONCLUSION













58

RESULT AND CONCLUSION


Secondary Data analysis:

 From Table1.2 we have analyze that the average rate of return
on investment of all Five gold exchange traded fund are following in the
same range which shows that all funds giving more or less same
return on investment.
 Skewness result shows that all five gold exchange traded fund
having Negative skewness which means all are skew toward Left thus it
is clear that the data point of Return on investment are less than the mean


































59








BIBLIOGRAPHY
















60

BIBLIOGRAPHY



1. www.scribd.com

2. www.nseindia.com

3. www.bloomberg.com

4. www.bseindia.com










































61

QUESTIONNAIRE

1. Do you invest Money?
Yes ( ) No ( )
2. Are you aware About Gold ETF Schemes?
Yes ( ) No ( )
3. Do you invest in Gold ETF Schemes?
Yes ( ) No ( )
4. Reason for investing in Gold ETF Schemes?
 Less volatility in Return ( )
 Better Return expectations in over debt ( )
 Safety ( )
 Available in Electronics format ( )
 Tradable on Exchange ( )
 Portfolio Diversification ( )
 Other ( )
5. What your investment objectives?
 Safety in return ( )
 Good return with low risk ( )
 High Return with high risk ( )
 Other ( )
6. Rate the following investments upon your investment preference?
INVESTMENT OPTION 1 2 3 4 5
Fixed Deposit
Debt Security
Mutual Fund
Equity
Insurance