An Assessment of Impact of Domestic Price of Gold on NAV of Selected Gold Exchange Traded Funds

Abstract

Study undertaken assesses the impact of behavior of domestic price of gold on selected gold exchange traded funds which were launched in the year 2010 at National Stock Exchange. The selected gold exchange traded funds constitute HDFC Gold Exchange Traded Fund, ICICI Prudential Gold Exchange Traded Fund and Religare Gold Exchange Traded Fund. Since, the investment objective of every selected scheme under research study is directly related to the domestic price of gold. So, the daily fluctuations of domestic price of gold are taken into account for assessing the impact on NAV prices of selected gold exchange traded funds. The study is aimed to meet objectives of (a) identifying whether NAV of all the selected three funds under research study is dependent upon Domestic Price of Gold. (b) Identifying in which respects NAV of the selected gold exchange traded funds differ from each other. Statistical calculation involves calculating arithmetic mean, standard deviation and standard error. The method for interpretation of data is application of Z-test that will assess the validity in results. This study helps investors to get a detailed insight in what respects NAV gets dependent upon domestic price of gold and the differentiating factors that differs NAV of the selected three Gold ETF mutual fund schemes under research study. This will prompt the investors to check the differentiating parameters of NAV while selecting the mutual fund house for investing in Gold ETF.