Groww CEO Varun Gupta | Everything You Need to Know About Gold ETFs
Join us for an insightful conversation with Varun Gupta, CEO of Groww, as we dive deep into the world of Gold ETFs! Whether you're a beginner or an experienced investor, this session will help you understand how Gold ETFs work, their benefits, and why they can be a smart addition to your investment portfolio.
Topics We’ll Cover:
What are Gold ETFs and how do they work?
Benefits of investing in Gold ETFs vs. physical gold.
Current market trends and expert insights.
How to get started with Gold ETFs on Groww.
Live Q&A session with Varun Gupta!
Don't miss this opportunity to get expert advice straight from the industry leader!
Set your reminders, subscribe, and hit the notification bell to stay updated!
#ShareMarketToday #StockMarket #Groww #GrowwGoldETF #GoldETF #ETF
#GoldETF #Investment #Grow #LiveShow #VarunGupta #Finance #WealthManagement #GoldInvesting #MarketTrends
~HT.178~PR.147~ED.148~GR.121~
Join us for an insightful conversation with Varun Gupta, CEO of Groww, as we dive deep into the world of Gold ETFs! Whether you're a beginner or an experienced investor, this session will help you understand how Gold ETFs work, their benefits, and why they can be a smart addition to your investment portfolio.
Topics We’ll Cover:
What are Gold ETFs and how do they work?
Benefits of investing in Gold ETFs vs. physical gold.
Current market trends and expert insights.
How to get started with Gold ETFs on Groww.
Live Q&A session with Varun Gupta!
Don't miss this opportunity to get expert advice straight from the industry leader!
Set your reminders, subscribe, and hit the notification bell to stay updated!
#ShareMarketToday #StockMarket #Groww #GrowwGoldETF #GoldETF #ETF
#GoldETF #Investment #Grow #LiveShow #VarunGupta #Finance #WealthManagement #GoldInvesting #MarketTrends
~HT.178~PR.147~ED.148~GR.121~
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NewsTranscript
00:00Marun, we will talk about Gold ETF, but before that there is a very simple and basic question
00:12that why should any investor add gold to his portfolio?
00:16How does gold make the investor's portfolio strong?
00:20Thank you very much Bhavna ji, this is a very relevant question.
00:25Most of us invest in digital assets, and when you invest in digital assets, it comes to your mind
00:38to invest in stocks or mutual funds.
00:40But it is very important to know that the traditional asset class, gold, has also been financialized.
00:47As you said, everyone knows that gold is one of the oldest, if not the oldest,
00:52one of the oldest asset class and people have been investing in it since the 19th century.
00:59At that time, gold coin was also used as a currency.
01:04If we talk about any asset class, first of all, we look at its returns.
01:11If we look at long term returns, 1 year, 3 years, 5 years, 10 years, 15 years or 18 years,
01:17then you will see that gold has given good returns in many places, it has also beaten Nifty 50 in many places.
01:23If you look at the last 1 year returns, gold had 28.5% returns whereas Nifty had a little less.
01:30And in the long term, in 18 years, gold has given 1-2% more returns than Nifty.
01:34But we talked about the long term, but if you look at the short term,
01:38in the short term, if you look at any time period where there is a risk in the system,
01:43where there is a market downturn, you will see that gold has almost always outperformed the market.
01:50The reason for this is that gold's correlation with equity is very limited.
01:55It is a completely different asset class and its correlation with debt is also very limited.
01:59And it is considered as a hedge.
02:01Hedge means that if you have a core portfolio,
02:04then when your core portfolio goes down, it will balance out.
02:10So many investors use gold as a hedge.
02:13And this usually happens to manage the market risk.
02:18Like if the market is at an all-time high or if there is volatility.
02:21And if you look at any time period, like we have seen many time periods.
02:25I will tell you one by one.
02:27We saw the subprime crisis from January to March 2008.
02:30Nifty 50 had fallen from 22.5% to minus 22.5% returns.
02:36At the same time, gold's returns were about 10%.
02:39If you look at July-September 2011, where Nifty 50 had given minus 13.85% returns.
02:46At that time, gold had given 9% plus returns.
02:48Similarly, we have many such scenarios.
02:51And specifically when a systemic risk is built, like the dot-com bubble in 2001-2002.
02:56When there was a subprime crisis, like I told you.
02:58So whenever we have seen that gold has always outperformed equity.
03:04And in the long term, its returns are almost at par with Nifty 50.
03:08So that's why we always recommend our investors.
03:11That some percentage of allocation should be in gold.
03:14And that can be according to your risk appetite.
03:16Either between 5%-25% as you think is right.
03:22That means gold's return has always been good.
03:26Even many times gold's return has beaten Nifty 50.
03:29So it is a safe haven asset.
03:31But you can invest in gold according to your risk appetite.
03:36But Varun, tell us why should gold be added in the form of ETF?
03:40ETF is a very interesting concept.
03:45I will explain it to you in detail.
03:47Till now, our investors used to think that we should buy physical gold.
03:54But there are many types of risks in physical gold.
03:57First of all, there is no parity in the price.
04:00If you are buying from Delhi, Mumbai or Bangalore.
04:03The prices are different everywhere.
04:05There are making charges, GST.
04:07There are many types of charges.
04:09There is a risk associated with it.
04:12There is a storage cost.
04:13Where will you keep it?
04:14You will have to manage it.
04:15And even if you sell it at some time, you will have to pay different charges.
04:20And you can never be sure of its purity.
04:25What does gold ETF do?
04:29All the gold units that you buy online.
04:3299.5% purity gold is deposited in a vault.
04:38The vault is managed by a custodian.
04:40It is an arm of SBI called SBISG.
04:42And the gold is completely insured.
04:44And because it is completely regulated and semi-regulated.
04:50There is no impurity in it.
04:52The process is completely well established.
04:54There is no possibility of any problem.
04:57You can invest in gold without any extra charges.
05:02Whether you invest in physical gold or ETF.
05:07The more gold you have, the more returns you will get.
05:11But because there is no extra charge in it.
05:14There is no charge when you invest.
05:17There is no charge when you withdraw.
05:20AMC has an expense ratio of 40-50 bps.
05:23Which is very less compared to 3% and GST.
05:27And making charges and selling charges etc.
05:31In this, your returns are more than physical gold.
05:34And there is no risk of any kind.
05:36ETF operates like this.
05:38The most important thing is that it will come in your Demat account.
05:41You can liquidate it anytime.
05:43There is complete liquidity in it.
05:45You don't have to wait where to sell your gold.
05:48Where to access this money.
05:50You can buy it immediately or sell it immediately.
05:52This functionality, ease of access and complete transparency.
05:56Gold investors get from gold ETF.
05:58Varun, our comparison was of physical gold.
06:02And ours was of ETF.
06:04But if we look at it digitally.
06:08We have many other ways to invest in gold digitally.
06:13But why is it an advantage to choose gold ETF?
06:18I will tell you two more ways.
06:20How people have invested in gold digitally.
06:22One is that there is a new category called digital gold.
06:25Digital gold is also transparent.
06:28You get gold price in it.
06:30But the most important point is that
06:32When you go to sell it, it takes 3% charge.
06:35That can be selling charge or whatever it is.
06:39So that 3% charge goes away from your return immediately.
06:43Which will not go in gold ETF.
06:45Second is that it is not a completely regulated way.
06:49For example, gold ETF is completely regulated.
06:52There is voltage, SBISG, etc.
06:56So there is complete surety in it.
06:58There is no possibility of any loss.
07:01Digital gold is not completely regulated.
07:03Regulation is yet to come.
07:06So in terms of safety, I would say gold ETF is significantly higher.
07:12Another way is SGB.
07:15Sovereign Gold Bond.
07:16Which has become very popular among investors.
07:18Sovereign Gold Bond is also a good way to invest in gold.
07:24The fundamental problem that I face on a personal level is that
07:28There is some liquidity issue in it.
07:30Because it has 69 tranches.
07:32And every tranche has a different type of investor.
07:34While gold ETF is a mutual fund scheme.
07:37There are many investors in it.
07:39So liquidity will always be there.
07:41We also provide liquidity to customers through market maker.
07:44While in SGB, there is some liquidity issue.
07:48And at the same time, there is no new tranche since February 2024.
07:53So there is no new tranche in this financial year.
07:56So the government is also thinking that it is a costly deal.
08:01Because of which they are raising money from the market.
08:03But overall, I think if you want to invest in gold.
08:09If you want to grow your portfolio with the growth of gold.
08:12Then better medium than gold ETF.
08:14Right now, I don't think to invest in digital gold.
08:17We are talking about gold ETF.
08:19Please tell us about Grow Gold ETF.
08:22What is it? How does it work?
08:25Grow Gold ETF is a semi-regulated scheme.
08:29As I told you, we invest as much money as the user can.
08:34Minimum investment in this is Rs. 500 in NFO.
08:36But after NFO, you can also take 1 by 100 gram of gold.
08:41For example, the price of 1 gram of gold is around Rs. 7800.
08:46And the price of 1 unit is Rs. 78.
08:49So you can start investing in gold ETF from Rs. 78.
08:54After this, the amount of gold you invest.
08:59At the end of the day, we deposit it in a vault.
09:04Which is a regulated process.
09:06As I told you, our custodian is SBISG.
09:08And that gold is completely insured against all types of risk.
09:12Any act of God or terror risk.
09:15Gold is insured against all types of risk.
09:17So your asset is completely insured.
09:19And completely safe.
09:21And you can sell it anytime.
09:23You can access it anytime in the market.
09:25So this is how Grow Gold ETF operates.
09:27And the daily gain or loss.
09:29The price benchmark of gold is LBMSA.
09:32So LBMSA is the largest bullion market in the world.
09:39From where the price of gold is decided.
09:41So in the same way, gold ETF operates.
09:50And in real time, gold prices are up or down.
09:52You can access it anytime in the market.
09:54The scheme that Grow Gold ETF has launched.
09:57So why has this scheme been launched in the festive season?
10:01Because we are seeing that gold prices are increasing.
10:07Gold prices are coming at an all-time high.
10:09So what is the reason?
10:11There are two questions here.
10:13We have launched it because of gold prices.
10:16We believe that gold is an evergreen investment product.
10:20You can invest in it anytime.
10:24And at that time, you should invest specially.
10:27When you see some volatility in the market.
10:29When you see some volatility in the equity market.
10:31Or when you see some risk in the equity market.
10:34So there are many factors that have come in the launch of our gold.
10:39For example, there has been a custom duty reduction.
10:42Because of this, gold prices have gone down.
10:44I will explain the importance of custom duty reduction.
10:50India is the second largest country in the world.
10:53Just next to China by a small amount.
10:55Which uses gold.
10:57And the majority of our gold is imported.
11:00So our import duty has reduced from 15% to 6%.
11:04Because of this, gold prices have gone down.
11:07Second, the Fed rate has been cut recently.
11:10And we have seen that whenever the Fed rate is cut.
11:14Then the gold prices increase.
11:16Because the demand for gold increases.
11:18Because there is excess liquidity in the market.
11:21So many things are coming together.
11:24Because of this, we have decided that gold is a good product.
11:27Which we should launch.
11:29Customers should be given an option.
11:31Customers who are worried about the market position and volatility.
11:35They can invest in gold.
11:37Everyone should invest.
11:38A small portfolio.
11:39And those who are more worried can also think of investing more.
11:42By consulting with their financial advisor.
11:44The second question you asked was.
11:47Why did you launch in Diwali and festive season?
11:52We have always had an objective in Groww.
11:57We want to connect more investors with the market.
12:03So that they can benefit from the growth of the market.
12:07Gold ETF has been existing in the market for a long time.
12:13But very few people know about it.
12:16Many people invest in the market.
12:18If you see, there are 5 crore investors of mutual funds.
12:22But there are very few investors of gold ETF.
12:25Because people don't know about it.
12:27People who know about it take advantage of it.
12:29As soon as the reduction in custom duty happened.
12:31In July, there was an inflow of 1300 crores in gold ETF.
12:36Many people could not take advantage of this opportunity.
12:39We want to tell people about gold through this festival season.
12:44Tell them that this is a new product.
12:47Give them an opportunity to take advantage of this growth in the long term.
12:53Perfect timing to launch gold ETF.
12:56Who can invest in Groww Gold ETF?
12:59Did you have a specific audience for this?
13:02Or any investor who wants to invest in gold can invest in it.
13:07Many products have a risk.
13:10Customers should invest according to their appetite.
13:13Especially in equity products.
13:14Gold is a product in which every investor should invest in their portfolio.
13:19I can say this with confidence.
13:22How much you allocate for your portfolio depends on your risk profile.
13:26Equity has an opposite effect.
13:28If you have a high risk appetite, invest less in gold.
13:33If you have a moderate risk appetite, invest more in gold.
13:36And so on and so forth.
13:37I suggest that everyone can invest in gold.
13:43You can invest at any time.
13:45And you should do it.
13:46Because it hedges your market risk in your portfolio.