{"id":4399,"date":"2023-03-21T13:04:28","date_gmt":"2023-03-21T07:34:28","guid":{"rendered":"https:\/\/fatakpay.com\/blog\/?p=4399"},"modified":"2025-11-11T18:03:04","modified_gmt":"2025-11-11T12:33:04","slug":"what-are-gold-etfs","status":"publish","type":"post","link":"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-are-gold-etfs\/","title":{"rendered":"What are Gold ETFs?"},"content":{"rendered":"\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-are-gold-etfs\/#Introduction\" >Introduction :<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-are-gold-etfs\/#More_on_Gold_ETFs\" >More on Gold ETFs:<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-are-gold-etfs\/#Purity_Price_and_Risks_of_Gold_ETFs\" >Purity, Price and Risks of Gold ETFs:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-are-gold-etfs\/#Gold_ETFs_vs_Gold_Bars_vs_Gold_Jewelry\" >Gold ETFs vs Gold Bars vs Gold Jewelry<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-are-gold-etfs\/#Who_should_invest_in_Gold_ETFs\" >Who should invest in Gold ETFs?<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-are-gold-etfs\/#Distinct_Advantages\" >Distinct Advantages<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-are-gold-etfs\/#Additional_links\" >Additional links:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/www.fatakpay.com\/blog\/learn-finance\/what-are-gold-etfs\/#About_FatakPay\" >About FatakPay:&nbsp;<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Introduction\"><\/span>Introduction :<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Discover the ins and outs of Gold ETFs &#8211; an investment vehicle that provides exposure to gold without the hassle of physical ownership. Learn about the benefits, risks, and how to invest in <strong>Gold ETFs<\/strong> to diversify your portfolio and potentially capitalise on the price movements of gold.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"More_on_Gold_ETFs\"><\/span>More on Gold ETFs:<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>An exchange-traded fund called a <strong>gold ETF<\/strong> serves as a physical gold alternative. Every investor is aware of how difficult and risky it may be to invest in actual gold. You can maintain your investment in gold without actually owning any physical metal thanks to gold ETFs. The sole underlying asset of a gold ETF, a type of commodity exchange-traded fund, is gold. One gram of gold is equal to one gold ETF unit.<\/p>\n\n\n\n<p>Investing in <strong>Gold ETFs<\/strong> entails buying gold electronically. When you redeem a Gold ETF, you receive its cash equivalent instead of the gold equivalent.<\/p>\n\n\n\n<p>The holdings of a Gold ETF are completely transparent. Furthermore, the ETFs have significantly reduced costs compared to real <mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-vivid-cyan-blue-color\"><a href=\"https:\/\/fatakpay.com\/blog\/gold-vs-silver-price-trend-2015-2025-how-to-invest-in-digital-gold\/\" target=\"_blank\" rel=\"noopener\">gold investments<\/a><\/mark> because of their distinct structure and creation method.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Purity_Price_and_Risks_of_Gold_ETFs\"><\/span>Purity, Price and Risks of Gold ETFs:<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>99.5% pure gold bars are used to represent gold ETFs. <strong>Gold ETF<\/strong> prices are available to buy or sell at any time through a stock broker and are displayed on the BSE\/NSE website.<\/p>\n\n\n\n<p>The taxes imposed on the acquisition or sale of actual gold are comparable to those imposed on gold ETFs. If an investor trades these money and profits, capital gains tax will be due. Both short-term and long-term investments in these trading funds are subject to taxes.<\/p>\n\n\n\n<p>An investor will be responsible for paying a 20% capital gains tax in this scenario, as well as any necessary indexations. Exchange-traded funds will be subject to capital gains tax for short-term investments, according to the individual&#8217;s existing tax bracket.<\/p>\n\n\n\n<p>Market risks that affect the price of gold are present for gold ETFs. The <strong>SEBI <\/strong><mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-vivid-cyan-blue-color\"><a href=\"https:\/\/fatakpay.com\/blog\/digital-investing-digital-gold-vs-mutual-funds\/\" target=\"_blank\" rel=\"noopener\">Mutual Funds<\/a><\/mark><strong> Rules apply<\/strong> to gold ETFs. A statutory auditor must regularly audit the physical gold that fund houses purchase.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Gold_ETFs_vs_Gold_Bars_vs_Gold_Jewelry\"><\/span>Gold ETFs vs Gold Bars vs Gold Jewelry<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<figure class=\"wp-block-table\"><table><tbody><tr><td>Transaction Charges<\/td><td>Jewellery<\/td><td>Gold Bars<\/td><td>Gold ETFs<\/td><\/tr><tr><td>Purchase<\/td><td>Making charges of 15-20 %<\/td><td>10-20 % mark up charges by banks<\/td><td>Brokerage of 0.5% or even less<\/td><\/tr><tr><td>Sell<\/td><td>10-20 % is lost due to purity issues<\/td><td>Banks do not take it back, so premium paid at time of purchase is written off<\/td><td>Brokerage of 0.5% or even less<\/td><\/tr><tr><td>Maintenance<\/td><td>Insurance charges and locker charges (if you put in locker)<\/td><td>Insurance charges and locker charges (if you put in locker)<\/td><td>1.00%<\/td><\/tr><tr><td>Tax Implications<\/td><td>Long term capital gain, but after 3 years, plus wealth tax<\/td><td>Long term capital gain, but after 3 years, plus wealth tax<\/td><td>Long term capital tax<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Who_should_invest_in_Gold_ETFs\"><\/span>Who should invest in Gold ETFs?<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>For individuals who want to invest in gold but do not want to do so in physical gold due to storage issues or uncertainty about the purity of gold and also want to receive tax advantages, <strong>gold ETFs are perfect<\/strong>. As there is no premium or making fee, investors could save money if they make a substantial investment. Moreover, one can buy as few as one unit (which is 1 gram).<\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Distinct_Advantages\"><\/span>Distinct Advantages<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Each unit is backed by high purity physical gold to ensure the quality of the gold, which is guaranteed.<\/li>\n\n\n\n<li>Real-time and Transparent gold pricing.<\/li>\n\n\n\n<li>Traded and listed on a stock exchange.<\/li>\n\n\n\n<li>Gold Investments are tax-efficient. The income derived from it is considered long-term capital gain.<\/li>\n\n\n\n<li>No wealth tax, security transaction tax, sales tax, or value-added tax<\/li>\n\n\n\n<li>No need to worry about theft because the units are kept in a digital <mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-vivid-cyan-blue-color\"><a href=\"https:\/\/fatakpay.com\/blog\/what-is-a-demat-account\/\" target=\"_blank\" rel=\"noopener\">demat account<\/a><\/mark>.&nbsp;<\/li>\n\n\n\n<li>ETFs are accepted as loan collateral.<\/li>\n<\/ul>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Additional_links\"><\/span>Additional links:<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p>Thank you for reading our blog! We hope this blog was informative. Here are some other blogs\/LinkedIn articles for you to check out.<\/p>\n\n\n\n<p><a href=\"https:\/\/fatakpay.com\/blog\/simplifying-gold-investment-online\/\" target=\"_blank\" rel=\"noopener\">https:\/\/fatakpay.com\/blog\/simplifying-gold-investment-online\/<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/fatakpay.com\/blog\/gold-vs-silver-price-trend-2015-2025-how-to-invest-in-digital-gold\/\" target=\"_blank\" rel=\"noopener\">https:\/\/fatakpay.com\/blog\/gold-vs-silver-price-trend-2015-2025-how-to-invest-in-digital-gold\/<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.linkedin.com\/pulse\/what-nbfc-fatakpay\/?trackingId=D2%2B1JHBR2HJnAYNnR2K8Rw%3D%3D\" target=\"_blank\" rel=\"noopener\">https:\/\/www.linkedin.com\/pulse\/what-nbfc-fatakpay\/?trackingId=D2%2B1JHBR2HJnAYNnR2K8Rw%3D%3D<\/a><\/p>\n\n\n\n<p><a href=\"https:\/\/www.linkedin.com\/pulse\/rise-fintech-its-impact-traditional-financial-institutions-fatakpay\/?trackingId=KAxZ0MrQ0npWYbWKTdkaZA%3D%3D\" target=\"_blank\" rel=\"noopener\">https:\/\/www.linkedin.com\/pulse\/rise-fintech-its-impact-traditional-financial-institutions-fatakpay\/?trackingId=KAxZ0MrQ0npWYbWKTdkaZA%3D%3D<\/a><\/p>\n\n\n\n<h3 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"About_FatakPay\"><\/span>About FatakPay:&nbsp;<span class=\"ez-toc-section-end\"><\/span><\/h3>\n\n\n\n<p><mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-vivid-cyan-blue-color\"><a href=\"https:\/\/fatakpay.com\/\" target=\"_blank\" rel=\"noopener\">FatakPay<\/a><\/mark> provides <mark style=\"background-color:rgba(0, 0, 0, 0)\" class=\"has-inline-color has-black-color\">virtual credit<\/mark> facilities for all. It&#8217;s available on your phone and caters to your everyday needs in both online and offline formats. Payments are done seamlessly through UPI\/QR codes. The solution provides an almost zero cost, free, quick, transparent and secure way to transact in a multilingual format with a Scan Now, Pay Later facility and easy repayment options.<\/p>\n\n\n\n<p>Link to FatakPay App: https:\/\/link.ftkp.in\/2uSI\/dkasgvnf<\/p>\n\n\n\n<p><\/p>\n\n\n<script type=\"application\/ld+json\">\n{\n  \"@context\": \"https:\/\/schema.org\",\n  \"@type\": \"BlogPosting\",\n  \"headline\": \"What are Gold ETFs?\",\n  \"description\": \"Understand what Gold Exchange-Traded Funds (ETFs) are, how they work, and why they are a good investment choice for diversifying your portfolio.\",\n  \"image\": \"https:\/\/fatakpay.com\/blog\/wp-content\/uploads\/2023\/03\/Gold-ETF-1.jpg\",\n  \"datePublished\": \"2023-03-21\",\n  \"dateModified\": \"2023-03-21\",\n  \"mainEntityOfPage\": {\n    \"@type\": \"WebPage\",\n    \"@id\": \"https:\/\/fatakpay.com\/blog\/what-are-gold-etfs\/\"\n  },\n  \"author\": {\n    \"@type\": \"Organization\",\n    \"name\": \"FatakPay Digital Pvt. 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More on Gold ETFs: An<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[260],"tags":[104,108,109,103],"class_list":{"0":"post-4399","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-learn-finance","7":"tag-etfs","8":"tag-gold","9":"tag-gold-etfs","10":"tag-investments"},"amp_enabled":true,"_links":{"self":[{"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/posts\/4399","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/comments?post=4399"}],"version-history":[{"count":11,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/posts\/4399\/revisions"}],"predecessor-version":[{"id":6901,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/posts\/4399\/revisions\/6901"}],"wp:attachment":[{"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/media?parent=4399"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/categories?post=4399"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.fatakpay.com\/blog\/wp-json\/wp\/v2\/tags?post=4399"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}