Kotak Mutual Fund launched Kotak Gold Fund

Kotak Mutual Fund launched Kotak Gold Fund

After Reliance mutual funds Gold Savings Fund,its now turn of Kotak mutual fund to launch a Gold Fund.It is essentially a Fund Of Fund scheme which invests in units of Kotak Gold ETF,which in turn invests in certified physical gold.

.A number of factors affects the gold prices,,most in general are inflation,Dollar index,geopolitical situations etc.Gold is considered as a hedge against inflation.and with rise in inflation investment managers turns towards Gold and silver. Also in general,it has negative correlation with Dollar index.Also geopolitical situations impact gold prices instantaneouly and confirms its safe heaven status...so common people are also showing interest in Gold as an investment option.

Currently,there are different options for investors to invest in this safe heaven commodity.Most of the investors prefer to buy Gold in physical way.In India it is a symbol of prosperity,,but it has certain disadvantages like safekeeping,purity etc...Next to this Gold can be traded at exchanges like Multi-commodity exchange(MCX),Indian Commodity Exchange(ICEX),National Spot Exchange Ltd.(NSEL).But these are useful mostly for trading with short term perspective only.Gold ETFs have emerged as a good option for investors to buy Gold in Demat form and can be hold for unlimited time.But there is a very less volume for these funds as investors need a Demat account or do not have expertise to trade in such funds with right way.

Kotak Gold Fund supercedes the limitations of Gold ETFs.First of all there is no need of Demat account.Conservative investors can invest in systematic wayand can be benefited with volatility of this commodity.

Kotak Goldnew fund offer will start from 4th March and will be end on 18th March.Scheme has a exit load of 2% for redemption of units within 6 months and 1% if redeemed within 6months to 1 yr.There will be no entry load in this scheme.

Expense ratio prescribed for this fund is maximum 1.50%.It means that there is a possible error of maximum 2% in returns of this fund from returns that offered by physical Gold.But facility of SIP(Systematic investing) offers more value to this fund and offers investors to invest in long term basis.

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