Investors globally have found solace in gold in the last one year when major world economies slipped into recession. Sample this: According to World Gold Council data, investment by exchange traded funds (ETFs) in gold was 150 tonnes in the third quarter (July to September-end).
In fact, after the collapse of Lehman Brothers, net inflows increased by $ 7 billion (111 tonnes) in just five trading sessions.
Back home, the situation is different. In the last one year, investment in gold ETFs in India has risen by a mere Rs 303 crore. In January, gold ETFs collected only Rs 30 crore. At present, the total assets under management (AUM) of gold ETFs stand at Rs 721.65 crore.
Investors have shown much more interest in other categories. In the past four months, when interest rates started softening, investors rushed to gilt funds and put in Rs 11,898 crore since October. Gold ETFs attracted only 39 crore in the same period.
This is despite the fact that gold ETFs, which mirror the price of gold, have given a decent return of 18.97 per cent (week ending February, 10) in the last one year.In the same time period, the returns given by equity diversified funds have fallen 47.11 per cent. Even the Bombay Stock Exchange Sensitive Index, or Sensex, has dropped 44.76 per cent. (Source: Press Trust of India)
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