The World Gold Council (WGC), using AMFI data, says this is the highest monthly inflow in seven months. Investors comparing a gold An exchange traded fund is a mutual fund scheme with units listed on a stock exchange, built to follow an index or an asset such as gold. Read the full meaning of ETF with a gold mutual fund are looking at two products that are both attracting money.
Gold ETFs' assets under management (AUM) fell to Rs 1,86,310 crore at the end of September from Rs 1,91,166 crore at the end of August, even though inflows had been higher.
The WGC puts total gold ETF AUM at about INR 1,863 billion which is around 2.25% of the total mutual fund AUM.
Listed on the exchange or bought from the fund house
Gold ETFs are listed non equity securities, so investors buy and sell their units on the exchange. For this, a demat account and a trading account are required.
Gold mutual funds usually work like unlisted fund-of-funds, as Taxguru explains them.
Business Standard reports that gold ETFs allow intraday trading, which means the units can be bought and sold within same trading day. The same report says gold mutual funds carry a slightly higher expense ratio than gold ETFs.
Holding periods decide the tax
The structure of the product decides the holding period for tax. Gold ETF units turn into long‑term ones after more than 12 months, a rule that has been in force for listed non‑equity assets since 23 July 2024, whereas gold mutual fund units need more than 24 months, according to Taxguru and Finnovate.
Long‑term profits from both investment options are normally taxed at 12.5% without any indexation, while short‑term gains are taxed at the investor's applicable income tax slab.
