Why Reliance Gold Savings Mutual fund is different?
We all know regular Mutual Fund Schemes invest the money collected from public, in equity market (company shares), Money Market, Government Bonds etc.
But, the all new Reliance Gold Savings Fund is a unique and different kind of Mutual fund Scheme to be launched by Reliance Mutual Fund from Feb-14th 2011 to 28th Feb-2011.
Investment in Gold – But why this is different from Gold ETF?
This is a first-of -its-kind investment scheme focused on gold. Immediately, the question that would flash in your mind is, "why this Scheme is unique and different when we have number of Gold Exchange Traded funds to invest in physical Gold?"
The answer is simple. Gold ETF investments are to be made only through Stock exchanges and you should have a trading and demat account opened through a Stock Exchange member to deal with a Gold ETF. These procedures would obviously hinder a common man to invest in a Gold ETF.
But to invest in Reliance Gold Savings Fund you need not have any Trading account or Demat Account. You can just buy it just like any other Mutual Fund schemes.
Investment in Gold throgh SIP:
You can also invest through Systematic Investment Plan (popularly known as SIP) in this scheme. In other words, you can invest a regular amount as little as Rs.500, every month.
What Reliance Gold Saving Fund will do with your money?
To put it precisely in mutual fund terms, this is a single manager Fund of Fund Mutual Fund Scheme. These type of mutual fund schemes normally invest only in mutual fund schemes of its own fund house.
Based on this principle, the primary objective of Reliance Gold Savings Fund is to invest in Reliance Gold ETF and give returns that is very closely corresponding to that of a Gold ETF scheme.
So, an investor who purchases the units of Reliance Gold Saving Fund would indirectly invest in Gold ETF Scheme. A typical Gold ETF would invest in physical Gold. Therefore, without much hassle, an investor of Reliance Gold Savings Fund can reap the appreciation of Yellow Metal in the long run. To put in simple terms Reliance Gold savings Scheme will act as a paper form of Gold.
Price per Unit: During New Fund Offer the unit price will be Rs. 10 per unit and subsequently at the prevailing rates when it opens after February 28, 2011.
Charges payable to the Fund House: There will be no entry load i.e no entry charges payable to the Reliance Mutual Fund House during New Fund Offer, but there is an exit load of 2% if switched or redeemed (charges payable if units are sold or transferred to another scheme) within 1 year of investment and this applies for the SIP option as well.
More details on this unique scheme can be obtained from the following Reliance Mutual fund website
Note: This article is aimed to provide information only. GConnect is not in any way connected with this scheme and does not intend to market the scheme. Readers are advised to read the Scheme Information Document carefully before investing. Risk Factors: Mutual Funds and securities investments are subject to market risks, and there is no assurance or guarantee that the objectives of the Scheme will be achieved.