HDFC Asset Management Company has recently announced the launch of HDFC Silver ETF. This is an open-ended Exchange Traded Fund (ETF) replicating/tracking performance of silver.

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This new fund offer (NFO) will close on August 26, 2022.

Investment objective

The investment objective is to generate returns that are in line with the performance of physical silver in domestic prices, the fund house said.

"Investing in physical silver and storing it in a safe manner could be difficult for an individual. Hence, HDFC’s Silver ETF NFO gives an opportunity to the investors to digitally invest and own silver which is easily tradable during market hours, replicates/tracks the performance of silver, and diversifies one’s portfolio at a low cost," it said.

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Commenting on the launch, Navneet Munot, Managing Director and Chief Executive Officer, HDFC Asset Management Co. Ltd. said, “This fund will provide investors an opportunity to enhance portfolio diversification by investing in a metal with a differentiated risk-return profile.”

"The fund encourages consumers to invest in silver due to its multi-purpose utility in industrial activities such as portable devices, industrial equipment, Electric Vehicles, mobility, energy production and telecom. Silver demand outlook is robust on account of higher adoption in new age and green technologies. Along with the above, it is also a precious metal which hedges against currency depreciation since it is globally priced," he said.

Who should invest?

According to the AMC, this NFO is suitable for investors who are seeking returns that are commensurate with the performance of silver, subject to tracking errors, over long term or who are seeking investment in silver bullion of 0.999 fineness.

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However, it's important to note that mutual funds are subject to market risks and investors should always consult their financial advisers if in doubt about whether the product is suitable for them. The product labeling assigned during the NFO is based on internal assessment of the scheme characteristics or model portfolio and the same may vary post NFO when the actual investments are made.

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(Source: HDFC AMC)

(Edited by : Anshul)

First Published:Aug 22, 2022 1:47 PM IST