Mutual funds can launch gold-exchange traded funds

The Securities and Exchange Board of India, India's marker regulator, amended its regulations, allowing mutual funds to launch gold-exchange traded funds (GETF), newspaper Daily News and Analysis (DNA) reported Thursday.

A gold-exchange traded fund unit would be like a mutual fund unit. It would be held mostly in dematerialized form. An investor would get a securities certificate given by mutual fund running the GETF defining the ownership of a particular amount of gold.

Gold prices are at nearly 25 year high in the country.

There's a safety angle too. Since GETFs are based on standards and transparency, manipulation by jewelers is avoided. A GETF would be affordable and investment will be in paper form.

Source: Xinhua