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Birla Sun Life Gold Exchange Traded Fund

February 14th, 2007

More mutual funds begins to race into the Gold ETF market. After Benchmark, UTI Mutual Fund, Kotak Mutual Fund, Prudential ICICI, Tata Mutual Fund and Escorts, the latest entrant expressing interest in launching a Gold Exchange Traded Fund (GETF) is Birla Sun Life Mutual Fund.

Birla Sunlife MF filed a draft offer document before SEBI for its upcoming Open ended Exchange Traded Scheme titled Birla Sun Life Gold Exchange Traded Fund. Investment objective of this fund is to endeavor to provide returns that, before expenses, closely track the performance and yield of Gold or Gold related instruments subject to tracking errors.

Flexibility is one area that this scheme is featuring a lot. According to the document filed, The Mutual Fund will allow investors the flexibility to switch their investments from any other scheme(s) / plans offered by the Mutual Birla Sun Life Gold Exchange Traded Fund 4 investments from any other scheme(s) / plans offered by the Mutual Fund to Birla Sun Life Gold Exchange Traded Fund (subject to completion of lock-in period, if any, of the units of the scheme(s) from where the units are being switched) during the NFO period and on ongoing basis thereafter.

The Minimum Application Amount during the NFO period is Rs. 5,000/ - and in multiples of Re. 1/- thereafter during the NFO
period. The Minimum Application Amount on Ongoing basis is Rs. 500/ - and in multiples of Re. 1/ - thereafter.

In regard to the load structures, the Entry Load is as follows:
For purchases/ switch – in of units upto Rs. 10 Lacs: 3%
For purchases/ switch – in of units greater than Rs. 10
Lacs but upto Rs. 1 crore: 1.50%
For purchases/ switch – in of units greater than Rs. 1
crore but upto Rs. 5 crores: 0.25%
For purchases/ switch – in of units greater than Rs. 5 crores: Nil

The Exit Load will be as follows:

Not exceeding: 0.50%.
However, the Trustee shall have a right to prescribe or modify the load
structure with prospective effect subject to a maximum prescribed
under the Regulations.

Entry Filed under: Mutual Funds, Birla Sun Life Mutual Fund, Gold ETF