Chandigarh/Jammu, February 11 (Scoop News) – Reliance Mutual Fund, a part of Reliance Capital Limited, on Friday, announced the launch of Reliance Gold Savings Fund. This first-of-its-kind fund-of-fund enables investments in gold, in paper form, without any Demat account. This is unlike the existing gold investments in Exchange Traded Fund (ETF) mode where a Demat account is mandatory.
The NFO was announced by Sundeep Sikka, CEO, Reliance Capital Asset Management, here today.
“We firmly believe that the gold investment opportunity in
The New Fund Offer (NFO) is the first gold fund that provides the investors with the hassle free facility to invest in the yellow metal through online and physical application mode – a key differentiator in the domestic mutual fund industry.
“Indians are known for their love for Gold, however with low Demat penetration in India, a lot of investors have not been able to participate in this safe mode of investment. This product will create a new avenue for pure gold investments for the retail investor without the need of having a Demat account or a locker ", said Sikka.
The investment objective of the scheme is to provide returns that closely correspond to the returns provided by Reliance Gold Exchange Traded Fund. The scheme’s performance will be benchmarked against the price of physical gold.
. Hiren Chandaria will be the fund manager of the open-ended gold fund.
The fund allows small regular investments of as low as Rs. 100 per month and in multiples of Re 1 thereafter.
“With monthly investments starting at Rs 100 we believe that this product introduces affordable gold investments to all sections of society. Gold as an asset class provides an opportunity to enhance portfolio returns over a period of time and acts as a perfect diversifier for one’s existing investment portfolio,” said Sikka.
This fund enables the investor to avail long-term taxation benefits from first year, unlike physical gold wherein long-term taxation can be availed after three years.
“Investors can directly subscribe or redeem units on all business days directly from the AMC through the physical mode at the various designated investor services centres across the country, thereby, making it easily accessible and convenient” said Sikka.
Entry load is nil for the scheme, as per SEBI’s guidelines, whereas the exit load is 2 per cent, if redeemed or switched out on or before completion of first year from the date of allotment of units.
The NFO would open on February 14 and close on February 28, 2011.