Purchasing and storing physical gold is something that increases the cost and security concerns involved while investing in the yellow metal. Which is where alternatives such as digital gold available on platforms such as Paytm or PhonePe, and Exchange Traded Funds (ETFs) that represent the value of the precious metal.
In 2022, the outflow of gold ETFs was down to $3 billion in value, as it slowed down to $534 million for December, marking eight straight months of negativity.
At the end of 2022, global gold ETF assets under management (AUM) stood at US$203 bn as per World Gold Council report 'Gold ETF Commentary'.
Last minute surge
A 3% gain in December took gold to US$1814/OZ, cementing a yoy gain of 0.4%, something that looked unlikely to many just two months ago, as per World Gold Council report 'Gold Market Commentary'.
The 3% hike in gold rates for December dragged back ETF outflows further, while they were supported by funds in Europe. The war in Ukraine had also led to a rise in demand for gold, as investors looked for a safe haven.
Since the yellow metal has been prioritised as a secure investment vehicle in India, the demand for gold ETFs has been surging since the beginning of 2022.
Driven by the festive spirit and wedding season, gold ETFs gained popularity among the next generation of Indian investors, as a convenient way to buy and store gold assets.
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