Bandhan Gold ETF NFO Opens on October 13, 2025: Invest Directly in Physical Gold

The NFO provides investors an opportunity to gain direct exposure to physical gold through an Exchange Traded Fund (ETF) managed by Bandhan Mutual Fund. The scheme aims to generate returns corresponding to the domestic price of gold before expenses, tracking errors, and fees. The NFO opens for subscription on October 13, 2025 and closes on October 15, 2025, with a minimum investment of ₹1,000. There is no exit load, and units can be purchased on stock exchanges or directly from the AMC in certain cases. The scheme offers a growth-oriented structure, making it suitable for investors seeking a transparent, cost-efficient, and regulated route to invest in gold without physically holding the metal.

Key Features of Bandhan Gold ETF

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• Open Date: October 13, 2025
• Close Date: October 15,  2025
• Exit Load: Nil
• Minimum Investment Amount: ₹1,000

Objective of Bandhan Gold ETF

The primary objective of the Bandhan Gold ETF is to generate returns that closely track the domestic gold price by investing in physical gold and gold-related instruments, before fees and tracking errors. The scheme does not guarantee returns but provides an efficient, regulated way to participate in the gold market.

Investment Strategy of Bandhan Gold ETF

• Allocate 95–100% of assets to physical gold and gold-related instruments.
• Invest 0–5% in debt and money market instruments for liquidity purposes.
• Track domestic gold prices to minimise tracking errors.
• Maintain a passive investment approach, avoiding frequent trading risks.
• Ensure transparency and efficiency in gold pricing through direct exposure.
• Facilitate purchases and redemptions via stock exchanges or in Creation Unit Size for large investors.

Risks Associated with Bandhan Gold ETF

• Price Volatility: Gold prices can fluctuate due to global demand, geopolitical events, and currency movements.
• Tracking Error: Returns may not exactly match domestic gold price movements.
• Liquidity Risk: Limited trading volumes may affect buying or selling efficiency.
• Regulatory Risks: Changes in government policies or taxation may impact returns.
• Market Risk: Broader market sentiment can influence ETF prices despite gold price movements.
• Redemption Risk: Direct redemptions are limited to large investors, restricting flexibility for smaller investors.

Risk Mitigation Strategy by Bandhan Gold ETF

The Bandhan Gold ETF mitigates risk by maintaining the majority of assets in physical gold, closely linked to domestic market prices. Tracking errors are controlled through efficient portfolio rebalancing and regular monitoring. A small portion of assets is invested in liquid debt instruments to manage redemptions and reduce volatility. Compliance with SEBI regulations ensures transparency, investor protection, and adherence to industry standards, further minimising operational and regulatory risks.

What Type of Investor Should Invest in Bandhan Gold ETF

• Investors seeking direct exposure to gold without holding physical metal.
• Suitable for those looking for inflation-hedged, commodity-based returns.
• Ideal for medium to long-term investors with moderate risk appetite.
• Best for investors who want a transparent and cost-efficient gold investment route.

Where Will the Bandhan Gold ETF Invest?

• 95–100% in physical gold and gold-related instruments for accurate market tracking.
• 0–5% in debt and money market instruments to maintain liquidity and operational efficiency.
• Assets structured to closely follow domestic gold price performance.