Groww Mutual Fund Introduces Groww Gold ETF: A Smarter, Simpler Way to Invest in Gold

NFO Period: 7th – 18th October 2024

Bengaluru, October 7, 2024: Groww Mutual Fund is introducing the Groww Gold ETF, offering investors a new, cost-efficient, and convenient way to invest in gold. The New Fund Offer (NFO) will be available from 7th October to 18th October 2024.

The Groww Gold ETF is an open-ended Exchange Traded Fund (ETF) that seeks to replicate the domestic price of *physical gold.

By investing in gold bullion with high purity (99.5%), this ETF provides investors with exposure to the gold market without the hassles associated with buying, storing, or insuring physical gold.

1Recent trends show an increasing interest in gold ETFs in India, driven by relative safety, potential returns, and the possible convenience these funds offer.

1A recent customs duty reduction in the July Budget has resulted in a 9% decrease in gold prices in India, presenting an opportunity for investors to acquire gold with lower taxes.

2Notably, investments in gold ETFs surged to ₹1,337.4 crore in July 2024, marking the highest monthly net inflows since February 2020. From May to July 2024, gold ETFs attracted significant inflows, totaling ₹2,890.9 crore.

Why Consider the Groww Gold ETF?
Aligned Returns with Gold Performance: The ETF seeks to closely mirror the price movements of gold, allowing investors to benefit from the performance of the metal, subject to tracking errors.

Regulated and Transparent: Governed by SEBI, the Groww Gold ETF is highly regulated, ensuring transparency in operations. Held in Demat accounts, the ETF seeks to offer investors security in a format that ensures the quality and traceability of their investments.

Gold as a Hedge: Gold has historically been viewed as a hedge against systemic risks, including financial crises and inflation. For example, during the 2008 global financial crisis, gold gave a positive return of 5.8% while major stock indices like the S&P 500 and Nifty 50 fell.

Similarly, during the COVID-19 pandemic, gold gave a return of 25.1% in 2020, which we believe has further reinforced its role as a stabilizer during uncertain periods.

Calendar Year	Returns Gold	Returns S&P 500 Index	Returns Nifty 50	Events
1978	37.00%	1.10%		1979 Oil Energy Crisis
1979	126.60%	12.20%
1986	19.00%	15.50%		Japanese asset price bubble & Black Monday of 1987
1987	24.50%	1.50%
1993	16.80%	6.30%		Black Wednesday (Sep 1992 Sterling Crisis)
2001	2.50%	-13.00%	-15.05%	Dotcom Bubble (US Tech Crisis)
2002	24.80%	-23.40%	5.34%
2008	5.80%	-38.50%	-51.27%	Global Financial crisis (2008 – 2009
2020	25.10%	16.30%	16.14%	COVID – 19 Crisis Inflation and Fed Tightening
2022	-0.30%	-19.40%	5.69%

Source – NSE, Bloomberg, Investing.com, September 27, 2024

Past performance may or may not be sustained in future and is not a guarantee of any future returns. Please read the SID to know in detail. Please consult your financial advisor before investing.

Convenient: Investors can buy and sell ETF units on the stock exchange during market hours, providing potential liquidity and price transparency.

Small Unit Flexibility: Investors can purchase small units of the ETF, each representing 0.01 grams of gold, making it accessible for investors with varying financial goals.

Collateral for Loans: The Groww Gold ETF can also be used as collateral for loans, providing an additional financial utility to investors.

3Potential Tax Efficiency: For long-term investors, the 3ETF offers the potential for LTCG (Long-Term Capital Gains) after a 12-month holding period, taxed at 12.5% without indexation. STCG (Short-Term Capital Gains) will be taxed according to the applicable income tax slab, making the ETF potentially tax-efficient compared to physical gold.

4Hedge against currency depreciation: From 2014 to 2024, gold has given 106.76% returns in USD terms, while the INR depreciated from 61.54 to 83.82 against the USD. This growth corresponds to a 181.62% return in INR terms, making gold a valuable asset for both currency depreciation and inflation hedging.

Past performance may or may not be sustained in future and is not a guarantee of any future returns. Please read the SID to know in detail. Please consult your financial advisor before investing.

Investment Details:
● NFO Period: 7th – 18th October 2024

● Minimum Investment: Rs 500

● Exit Load: Nil

● Fund Manager: Mr. Wilfred Gonsalves