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Monday, March 30, 2009

SBI Gold Exchange Traded Scheme floats on

NFO period from 30 March – 28 April 2009

SBI Mutual Fund house has launched initial offering period of SBI Gold Exchange Traded Scheme (SBI GETS), an open ended gold exchange traded fund on 30 March 2009. The new offer period (NFO) will close for subscription on 28 April 2009. The NFO price is Rs 100 per unit.

The investment objective of the fund is to seek to provide returns that closely correspond to returns provided by price of gold through investment in physical gold. However the performance of the scheme may differ from that of the underlying asset due to tracking error.

The scheme will offer only growth option.

During NFO, for both authorized participants and investors, the minimum application amount will be Rs. 5,000 and in multiples of Rs. 1 thereafter.

The fund seeks to raise Rs 1 crore as minimum target amount during NFO.

The scheme will invest 90%-100% in gold and gold bullion with medium to high risk profile. It will invest 0-10% in debt and money market instruments, with low risk profile.

During NFO period, for application size up to Rs 25 lakh, 2.50% will be an entry load. For application size of Rs 25 lakh to Rs 50 lakh, 1.50% will be entry load. The SBI GETS will charge 1.00% entry load for application amount of Rs 50 lakh to Rs 1 crore while for application amount above Rs 1 crore, no entry load will be charged. During NFO period, the scheme will not levy exit load.

During continuous offer no entry load and exit load is applicable on ongoing basis.

For SBI GETS, benchmark is the price of the gold.

Ritesh Sheth will handle the scheme.

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