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    Question

    Consider the following statements about ‘Gold

    Exchange Traded Funds (ETFs)’: I. Gold ETFs are passive investment instruments that are based on gold prices. II. One gold ETF unit is equivalent to one gram of gold and does not need to be backed by physical gold. III. Gold ETF, aims to track the International physical gold price. Which of the statements given above is/are correct?
    A I only Correct Answer Incorrect Answer
    B II only Correct Answer Incorrect Answer
    C III only Correct Answer Incorrect Answer
    D I and II only Correct Answer Incorrect Answer
    E II and III only Correct Answer Incorrect Answer

    Solution

    Gold Exchange Traded Funds (ETFs) are simple investment products that combine the flexibility of stock investment and the simplicity of gold investments. Gold ETF, which aims to track the domestic physical gold price, are passive investment instruments that are based on gold prices and invest in gold bullion. Gold ETFs are units representing physical gold which may be in paper or dematerialised form. One gold ETF unit is equivalent to one gram of gold and is backed by exceptionally pure physical gold. 

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