New Delhi: Gold ETF Witness Net Outflow of ₹396 Crore in April
Gold exchange traded funds (ETFs) experienced a net outflow of ₹396 crore last month, marking the first withdrawal since March 2023, primarily due to profit booking. Despite this decline, the asset under management (AUM) of gold funds grew by 5% to ₹32,789 crore at the end of April from ₹31,224 crore in the previous month, according to data from the Association of Mutual Funds in India (Amfi).
Net Withdrawal and Previous Trends
In April, Gold ETFs saw a net withdrawal of ₹396 crore, contrasting with an inflow of ₹373 crore in the month before. The last time this asset class had witnessed a net outflow was in March 2023, with a withdrawal of ₹266 crore. This recent shift in investor behavior could be attributed to the profitability that gold has shown over the past year, although it pales in comparison to the gains seen in the equity market.
Insight:
Market analysts suggest that the fluctuating flows in the gold ETF category, in contrast to the consistent performance of equities, may have prompted some investors to take the opportunity to secure profits in the gold segment. Melvyn Santarita, an analyst from Morningstar Investment Research India, highlighted this trend, emphasizing the potential reasons behind the recent net outflows in the gold ETF market.
