IDBI Mutual Fund has launched gold ETF

By Pradeep Yuvaraj | September 8, 2011

A recent press report said that IDBI Mutual Fund, a wholly-owned subsidiary of IDBI Bank has launched an open-ended gold exchange traded fund (ETF) for retail investors.

Reports said that the new fund offer (NFO) will be opened for subscription from 19 October and will end on 2 November 2011. The allotment of units is expected to take place on November 10. The minimum application amount for the NFO is Rs 10,000 and in multiples of Re 1 thereafter.

IDBI MF is said to offer direct buy-sell options at NAV-related prices for investments of 1,000 units and above. The first gold offering by the company, will invest in physical gold and track gold prices and the benchmark for the fund will be the domestic price of gold.

Mr. Debasish Mallick, Managing Director and Chief Executive, IDBI Asset Management Ltd said the company has planned to list IDBI gold ETF units on the NSE and BSE to impart liquidity. He also said that reputed bullion dealers have been appointed as market-makers to provide buy-sell quotes in the markets on a regular basis. He added saying that the company has planned to offer direct buy-sell options at NAV-related prices for investments of 1,000 units and above.

Mr. Mallick mentioned that the unique feature of IDBI Gold ETF is that it can be used as security for taking loans from IDBI Bank. IDBI bank offers home loan, personal loan, vehicle loan, education loan, mortgage loans etc.

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About Pradeep Yuvaraj

Pradeep Yuvaraj is a Co-Founder and Director at Finerva Financial Solutions Private Limited, a financial education company focused on personal finance education. He has penned over 250 articles relating to Personal Finance and clocked over 500 hours of educating individuals on managing personal finance. He is a serial entrepreneur and has been associated with 7 Start-ups. His entrepreneurial experience spans industries as varied as Education, Gas Engineering, Automobile Design, Software development and more recently a Pure play presentation design company. Prior to turning entrepreneur in 2005, he has worked for 3 of the top ten companies of the world - Shell, ExxonMobil and Total SA. This experience included handling Branch Operations, Channel Sales and Business Development across 5 states over a period of 8 years. He holds an MBA from Symbiosis and an Electronics Engineering Degree from the University of Pune.

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