NFO Alert: All you need to know about newly launched DSP Gold ETF Fund of Fund

The scheme was opened for public subscription on November 03, 2023, and will close on November 10, 2023. The scheme is reopened for sale and repurchase continuously within five business days from the date of allotment.

What type of mutual fund scheme is this?

This open-ended Fund of Funds scheme is suitable for seeking investors

• Long term capital growth
• Investments in DSP Gold ETF units which in turn invest in physical gold

What is the main objective of investing in this fund?

The main investment objective of the scheme is to generate returns by investing in DSP Gold ETF units. There is no guarantee that the investment objective of the scheme will be achieved.

“Gold contributes significantly to a conventional equity – heavy debt portfolio due to the low correlation with these asset classes. The scheme structure presents a convenient way to diversify your portfolio and systematically accumulate gold, automatically adding depth and multi-dimensionality to your investments,” says Anil Ghelani, CFA, Head – Investments & Passive Products, DSP Mutual Fund.

How can one invest in this scheme?

Investors can invest under the scheme with a minimum investment amount ₹100 per plan/option and in multiples of Re 1. There is no upper limit for investment.

Under normal circumstances, the scheme’s asset allocation will be as follows:

Are there similar mutual funds in the market?

To date, many asset management companies (AMCs) have launched such gold ETF fund of funds. Most of these funds are not very old, which means that investors can only judge them by their recent performance. These include:

How will the scheme benchmark its performance?

The performance of the scheme will be benchmarked against the domestic price of physical gold (based on the London Bullion Market Association (LBMA) daily fixed price of gold). As the scheme invests primarily in DSP Gold ETF, which invests in physical gold in turn, the aforementioned benchmark is the most appropriate to compare the performance of the scheme.

Are there any in or out loads in this scheme?

There is no “Entry Load” in this scheme, which means investors do not have to pay anything to park their earnings in this scheme.

Who will manage this scheme?

Anil Ghelani and Dipesh Shah are the nominated fund managers of this scheme.

Is there any inherent risk in the fund?

“High Risk” applies to the scheme as per the details mentioned in the Scheme Information Document and is best suited to investors who are willing to accept that their principal risk will be subject to high risk. However, investors should consult their financial advisers if they are in doubt as to whether the product is suitable for them.

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Updated: 03 November 2023, 05:33 PM IST