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Investors continue to pull out money from gold exchange—traded funds (ETFs), but the pace of outflow has slowed down in the current fiscal on account of sluggish equity market trends.
The gold ETFs witnessed a net outflow of Rs 489 crore in the first seven months (April—October) of the ongoing fiscal year, down from an outflow of Rs 1,016 crore in the same period of 2014—15 fiscal.
These funds witnessed outflows in the last two fiscals as well - Rs 1,475 crore in the entire 2014—15 and again a withdrawal of Rs 2,293 crore in 2013—14.
Market experts attributed the slower pace of outflows to weakness in stock markets.
The demand for gold ETFs has been steadily falling for the past two years. These products have seen outflow as gold prices are correcting and equities have given good returns to investors.
The benchmark BSE Sensex has plunged by 4.65 per cent during the period under review.
The outflow pulled the assets base of gold funds to Rs 6,226 crore in August from Rs 6,655 crore at the end of the last financial year.
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