The Euro crisis and unabated inflation (9.59 per cent in April) have made investors rush to buy the safety that gold provides. Gold prices have gone up from Rs 16,320 per 10 gm (23 April) to Rs 18,360 (14 June), a rise of more than 12 per cent. Mutual funds, too, are adding gold in their diversification mix. Two new recently launched funds, which will invest in the yellow metal, are Religare MIP Plus, which will put in at least 10 per cent in gold ETFs, and Canara Robeco Indigo Fund, which has the mandate to invest 10-35 per cent.
"Gold is less volatile than equities and offers higher returns compared with debt funds," says Ritesh Jain, head, fixed income, Canara Robeco Mutual Fund. "Including gold in an MIP makes it easy for an investor to track a single scheme rather than having to invest and track three asset classes," explains Saurabh Nanavati, CEO, Religare Mutual Fund.
