Indian ETFs take off

Indian opportunities for investing in gold tracking funds have been boosted by the launch of a new Exchange Traded Fund (ETF) by Reliance Mutual Fund.

The Reliance Gold Exchange Traded Fund will be initially available for trading subscription until November 1st, with the face value of the fund fixed at Rs 100 ($2.54) and the one time investment minimum declared at Rs 5,000 ($127).

ETFs are making tracks in India as more and more investors look to buy gold, but without the need for taking physical delivery of bullion.

The simple option of open-ended funds that track gold prices appeals to many newcomers to the gold market, with the success of ETFs like StreetTracks leading the sub-continent to expand into the sector.

Three Indian domestic mutual funds are already in place to offer ETFs, with offer gold exchange traded funds, with latest Kotak Mahindra Asset Management adding to the options opened up previously by Benchmark and UTI Mutual.

Total gold collection from the country's ETFs rose from 3.33 metric tons in August to 3.38 in September, making it an appealing market for newcomer Reliance.