Accelerating Growth of Gold ETF in India

Gold is one of the precious metals and has been of great significance to different cultures. Gold is one of the best way to diversify the portfolio and to protect the wealth of the investors. There are number of ways to invest in Gold i.e.  buying Jewellery, Gold Coins, Bullions, Gold Funds of Funds as well as Gold ETFs. The objective of the current paper is to compare the performance of different investment alternatives i.e. Market(Nifty, NSE 500),Saving Deposits, Fixed Deposit and PPF from the period 2007 to 2014 by using absolute and relative performance measure. The findings of the study suggests that Gold ETFs are providing higher average returns at a lower risk as compare to the market. Also  the systematic risk for the Gold ETFs are negative implying that inclusion of Gold stocks in the investor’s portfolio will make it more diversified and riskless. Investment in Gold can be beneficial to both retail and the institutional investors.