The inflow is likewise expected to continue rising in the coming months amid strong demand driven by the festival season in the country, according to the Association of Mutual Funds in India (Amfi) monthly data.
Gold’s price correction provided buying opportunity for investors
Gold is considered as a hedge during an economic downturn and when there are uncertainties in the equity markets, but the yellow metal is on a downward trajectory since June. But Srivastava noted that the correction in the price of gold over the last few months served as a buying opportunity for investors, which translated into a robust inflow in gold ETF. Despite the inflow, the assets under management (AUM) of gold ETFs fell from Rs 16,350 crore, or $2.17 million, by the end of August to Rs 16,337 crore (or $2.17 million) in September-end. The AUM was at Rs 16,750 crore, equivalent to $2.23 million in July-end. Arshad Fahoum, the chief product officer of Market Pulse, however, remained optimistic that the inflows in gold ETFs will remain positive in the coming months because of the momentum in the gold price and the festival season. He added that more people will invest in gold ETFs because of the overheated equity markets and rising inflationary pressure call for diversification. [coinbase]
