Gold mutual funds have shown strong performance; some have delivered over 20% return in the past 6 months. SBI Gold gave over 24% return and Quantum Gold Saving Fund gave over 23% return in the same period. Should you consider gold mutual funds? Here’s all you need to know. Gold is shining and how! The prices of gold are on a roll amid geopolitical tensions. And the yellow metal has also emerged as one of the best-performing asset classes compared to other avenues. According to experts, picture abhi baaki hai…They expect gold prices to rally further as several factors have turned positive for the yellow metal. Gold mutual funds have also shown strong performance; some have delivered over 20% return in just 6 months. SBI Gold gave over 24% return in the last six months. Quantum Gold Saving Fund gave over 23% return in the same period. Now, if you are unaware of the Gold Mutual funds, let me tell you a little bit about these funds. Gold mutual funds are open-ended funds that allow the citizens to invest without a Demat account. The gold fund units are determined by way of Net Asset Value (NAV), which is disclosed at the end of the trading hours. In this scheme, experts manage the investment professionally to create wealth and reduce risks. Gold mutual funds typically invest in a diversified portfolio of gold-related assets such as gold bullion, gold mining stocks, and gold ETFs. This diversification helps spread risk across multiple assets within the fund, reducing the impact of underperformance of any single asset on overall returns. So is it the right time to invest in gold mutual funds or any other form of gold? Well, according to the gold outlook report by HSBC Global Research, the rise in geopolitical risks serves to increase the demand for gold, which has a reputation as a tried and trusted asset in this regard. It believes that geopolitical risks, which by any metric have escalated in the last couple of years – as well as trade frictions – have played an important role in sustaining gold prices. Also growing concern over mounting fiscal deficits may keep gold supported at higher levels than would otherwise be the case. Citi Research believes that the gold rally is not only fueled by geopolitical turmoil. The gold buying spree among central banks around the world, most notably China; and the projection of interest rate cuts by the US Federal Reserve later this year, have added to the surge. According to JM Financial Services, one can buy the yellow metal at dips and keep adding gold in a staggered manner as support is now seen at 70400 and next at 68000 levels; it even sees prices moving higher towards 75500-76000 levels in the short-term.
Over 20% Return in 6 Months! Are Gold Mutual Funds The Right Investment Option?
