An Exchange-Traded Fund (ETF) is an instrument traded on the stock exchanges. An ETF tracks and replicates the gains of an underlying asset.
A Gold ETF is an instrument that invests in 99.5 pure gold by purchasing bullion or futures contracts.
The performance of a Gold ETF is identical to that of gold. A rise in the price of gold will result in a rise in the value of the Gold ETF and vice versa.
Investors can buy or sell Gold ETFs on the stock exchange where they are listed. A demat account is necessary to invest in Gold ETFs.
Gold ETF does away with the need to invest in physical gold and is a great way for investors to diversify their portfolios.
Earnings on Gold ETFs are subject to long-term capital gains tax but are exempt from Value-Added Tax (VAT) or Securities Transaction Tax (STT).
Open a Groww Account & start investing !