Gold Accumulation Facility
SBI Gold Fund announces the unique Gold Accumulation Facility under it's Systematic Investment Plan (SIP) / Systematic Transfer Plan (STP). Now investors can decide on a quantity of gold that they want to purchase at regular intervals. SBI Gold Fund invests its corpus in SBI GETS (SBI Gold Exchange Traded Scheme). Under this facility, you can opt for the SIP/STP installments in terms of number of units of SBI GETS. One unit of SBI GETS represents approximately one gram of gold. (Refer to terms and conditions of Gold Accumulation Facility before investing). Invest in SBI Gold Fund just like any other mutual fund scheme, providing you an opportunity to take exposure into Gold as an asset class, in a convenient way.
SBI Gold Fund is an open ended fund of fund scheme, which will invest in units of SBI Gold Exchange Traded Scheme (SBI GETS). The scheme seeks to provide returns that closely correspond to the returns provided by SBI GETS.
Why invest in gold?
Gold, the most precious metal of all, is also a popular form of investment. The savings come handy, for instance, during your daughter’s wedding. Investors can make the most out of its appreciating value potential without going through the hassles of physically possessing it, through Gold ETFs and Fund of Funds (FoFs). Better still, one may invest a small amount through SIP in Gold FoFs. So invest now and enjoy its growth potential.
Gold as an asset class:
Gold as an investment asset has given reasonable returns (in USD) during the last decade.
Hedge against other asset class:
Gold, as an asset class has low correlation with other asset classes like equity and bonds. It has low correlation with economic downturn in volatile times and is a good hedge against inflation. Coupled with strong appreciation for over a decade, Gold has emerged as an important asset class for investments in one's portfolio.
Diversification:
Easy and convenient way to diversify one's portfolio.
SIP in Gold
The following table shows the SIP returns in Gold for the past 10 years if Rs. 5000 were invested every month. It is seen that Gold has given reasonable returns.
| Period | 1 Year | 3 Years | 5 Years | 7 Years | 10 Years |
|---|---|---|---|---|---|
| Amount Invested (Rs.) | 60,000 | 180,000 | 300,000 | 420,000 | 600,000 |
| SIP Start Date | 01/04/2012 | 01/04/2010 | 01/04/2008 | 01/04/2006 | 01/04/2003 |
| Gold Price (Rs/Gm) (As on March 28, 2013) | 2807.15 | 2807.15 | 2807.15 | 2807.15 | 2807.15 |
| Total no. of units accumulated | 20.85 | 77.02 | 163.18 | 290.78 | 590.16 |
| Investment value (As on March 28, 2013) in Rs. | 58516 | 216218 | 458073 | 816274 | 1656682 |
| Returns on SIP in Gold (%) | -4.65% | 12.36% | 17.02% | 18.69% | 19.32% |
Source: Bloomberg. Returns are as on 28/03/2013 with SIP being done on 1st of every month. Returns are CAGR & have been calculated for cash flows at different point of time using XIRR function in excel spreadsheet for LBMA AM Fix closing prices converted into INR.Past performance may or may not be sustained in the future.
