Physical Gold vs Top Gold Mutual Fund 5-year Calculator: Which has given higher return on Rs 10 lakh investment; see examples to know
Top Gold Mutual Fund vs Physical Gold 5-year Return Calculator: Gold mutual funds are a digitised form of the metal that tracks the price of 99.9 per cent pure gold. The fund invests in gold ETFs, and the price of its net asset value (NAV) replicates the price of physical gold on a daily basis.
Top Gold Mutual Fund vs Physical Gold 5-year Calculator: Gold investment is considered an important part of investor portfolio diversification. The metal is considered suitable for investors with a long-term investment horizon. They can invest in the metal in its physical form or in its digital form. The purpose of either is to get the benefit of the appreciation of the gold price. During a recession or in a rising market, the charm of gold investment never dies down. In this write-up, we will tell more about physical gold and gold mutual funds, which has been the top mutual fund in terms of annualised returns (CAGR) in the 5-year period, and which of them, top gold mutual fund and physical gold, has given a higher return on a Rs 10 lakh investment in 5 years.
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What are gold mutual funds?
Gold mutual funds are a digitised form of the metal that tracks the price of 99.9 per cent pure gold. The fund invests in gold ETFs, and the price of its net asset value (NAV) replicates the price of physical gold on a daily basis.
What are gold mutual funds?
These funds are passive and, hence, have a low expense ratio. Unlike physical gold, gold mutual funds can be bought at the same price throughout the world. It saves an investor from the hassle of storage costs, safety, and liquidity problems.
What is physical gold?
Physical gold is a tangible commodity asset that can be bought and sold in many forms. Investors buy physical gold as bars and coins. The shine of gold has attracted people since ages, so the majority of them buy gold in the form of jewellery. The price of gold fluctuates with time, but it is most likely to increase in the long term.
What is physical gold?
Physical gold involves the cost of transaction fees, storage, making charges, and insurance. The rate of gold can vary from buyer to buyer and city to city. When jewellery is sold, the jeweller can cut making charges.
Best gold mutual fund in 5 years
The best gold mutual fund in terms of the highest annualised return (CAGR) in 5 years is Axis Gold Direct Plan-Growth.
Axis Gold Direct Plan-Growth
The gold fund has given 14.64 per cent annualised return in the 5-year period.
The fund's assets under management (AUM) is Rs 603 crore, while its net asset value (NAV) is Rs 25.18.
The gold mutual fund has given 6.93 per cent annualised return since its inception in January 2013.
Axis Gold Direct Plan-Growth
The fund that tracks the price of physical gold has an expense ratio of 0.17 per cent.
The minimum SIP and lump sum investment in the fund is Rs 105 each.
Value of Rs 10 lakh investment in top gold mutual fund in 5 years
A Rs 10 lakh investment made in Axis Gold Direct Plan-Growth 5 years ago has grown to an estimated value of Rs 19.8 lakh.
Gold price 5 years ago and today
The gold rate (of 99.99 per cent purity) in New Delhi on October 22, 2019, was approximately Rs 31,850, while the rate today (October 22, 2024) is approximately Rs 80,530.
Current value of Rs 10 lakh investment made in physical gold 5 years ago
On a Rs 10 lakh investment, one could purchase nearly 314 gramme gold on October 22, 2019. The price of 314 gramme gold is approximately Rs 25,28,414.44 today.
So, physical gold has beaten the top mutual fund in terms of investment return in the 5-year period.