ICICI Prudential Regular Gold Savings Fund

ICICI Prudential Regular Gold Savings Fund (the Scheme) is a fund of funds scheme with the primary objective to generate returns by investing in units of ICICI Prudential Gold Exchange Traded Fund (IPru Gold ETF). This fund is being managed by Manish Banthia. This is a good fund to systematically add gold to your portfolio.

Where does ICICI Prudential Regular Gold Savings Fund invest your money?

ICICI Prudential Regular Gold Savings Fund invests your money predominantly in Gold ETFs' and a small portion is invested in short term debts or schemes which invest in the money market securities or Liquid Schemes. It has more than 98.47% exposure to ICICI Pru Gold Exchange Traded Fund (IPru Gold ETF) while around 1.53% exposure to Cash and Cash Equivalents.

Suitable for what?
  • Child’s education
  • Child’s Marriage
  • Planning for retirement
  • Home Purchase
Not suitable for what?
  • Creation of wealth
  • Lifestyle needs
  • Short term needs
How has ICICI Prudential Regular Gold Savings fund performed in the past?

If you had invested Rs 1 lakh when the fund was launched in October 2011, your value of investments would be around Rs 99691. The performance has been better or similar to other gold funds. The fund has been giving at around -.19% every year for those who stayed invested since inception.

Assume you had invested Rs 10,000 every month in ICICI Prudential Regular Gold Savings Fund through SIP since its inception today you would have around Rs 1.68 lakhs.

How will ICICI Prudential Regular Gold Savings fund perform in the future?

Gold prices have historically stayed a few percentage points above inflation in the long term period. In times of economic instability gold can give highest return among other asset classes but it levels out when long term performance is considered.

So if you expect inflation to grow annually at 8% gold mutual funds would give returns at around 10%.

How much to invest?

Minimum one time investment is Rs 5000 and minimum SIP is Rs 1000 per month. Concentrating your funds in a single asset category is very risky. At any point in time not more than 10% of your total investment portfolio should be allocated to gold in any form.

Our recommendation for fresh investment
Recommended
Our recommendation for existing investment
Recommended
When to enter?

Now! There is no good time to start investing rather than now. Do not try to time the market and especially if it is an SIP. Keep adding gold to your portfolio systematically, in small installments. If you have planned your investments and decided on the amount you want to invest do not think further, just go ahead.

When to exit?

Withdraw when your goals are closer to achievement. Do not remove the money when the gold prices go up or down. Do not panic. Stick to your goals.

 

How frequently you need to monitor the performance?

Once you invest in the fund do not get into the habit of checking the NAV daily or monthly. Review the performance once a year. Too much attention is not good.

What are the charges applicable?

Exit load of 2% is charged if units are redeemed within 15 months from the date of allotment. No exit load applies for units withdrawn post 15 months. Expense ratio of ICICI Prudential Regular Gold Savings Fund is 1.50%. This is charged to recover the fund management company’s expenses on securities’ transactions, commissions, registrar fees, etc. Your mutual fund returns will be total returns less expense ratio.

What are the tax implications?

If units are sold within one year than returns are taxed on the marginal rate i.e. as per the tax slab and if the units are sold after one year than long term capital gain applies which is taxed as 10.3% of gains if non-indexed, or 20.6% of gains if indexed, whichever is lower.

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