Gold mutual fund returns are poor
Gold schemes have generated an average negative return of 7.81 per cent during the last one year
By : DC Correspondent
Update: 2015-05-03 23:58 GMT
Mumbai: Investors in gold schemes offered by mutual funds are headed towards a big disappointment, as it is the only MF scheme, which has delivered a negative return over the past one year.The gold schemes have generated an average negative return of 7.81 per cent during the last one year with the net asset value (NAV) of some funds falling as much as 13 per cent during the period.
When compared to this, equity-oriented MF schemes have delivered impressive returns rewarding investors with 30-60 per cent gains in the past one year. Fund managers are not expecting an immediate recovery in the prices of gold as they believe that the yellow metal has lost its appeal as a hedge against inflation due to fall in global commodity prices and rising growth prospects in the US and Europe.
“Globally, there is no inflationary trend and the chances of financial crisis is very low. The gold has structurally entered into a bearish phase and its prices are expected to remain under pressure for another 2-3 years,” said S. Krishna Kumar, head of equity at Sundaram Mutual Fund.