Gold Monetisation Scheme (GMS):

SEBI has designated Gold Monetisation Scheme (GMS) of as a gold related instrument. Investment in GMS of banks by Gold ETFs of mutual funds will be subject to following conditions:

(a) The cumulative investment by Gold ETF in Gold Deposit Scheme (GDS) and GMS will not exceed 20% of total AUM of such schemes.

(b) All other conditions applicable to investments in GDS of Banks will also be applicable to investment by Gold ETFs in GMS. Existing investments by Gold ETFs of Mutual Funds under the GDS will be allowed to till maturity under these are withdrawn permanetly.

1. Valuation
Since physical gold and other permitted instruments linked to gold are denominated in gold tonnage, it will be valued based on the market price of gold in the domestic market and will be marked to market on a daily basis. The market price of gold in the domestic market on any business day would be arrived at as under:

Domestic price of gold = (London Bullion Market Association AM fixing in US$/ounce X conversion factor for converting ounce into kg for 0.995 fineness X rate for US$ into INR) + custom duty for import of gold + sales tax/ octroi and other levies applicable.

The Trustees reserve the right to change the source (centre) for determining the exchange rate. The AMC should record in writing the reason for change in the source for determining the exchange rate.

2. Determination of Net Asset Value

NAV of units under the Scheme would be calculated as shown below:

 

	Market or Fair Value of Scheme’s investments + Current Assets – Current Liabilities and Provision
Nav  ( Rs  )=	___________________________________________________
	No. of Units outstanding under Scheme on the Valuation Date

 

The NAV shall be calculated up to four decimals.

3. Recurring Expenses

For a GETF, the limits applicable to equity schemes as specified in SEBI Regulations shall be applicable.

4. Benchmark for GETF

As there are no indices catering to the gold sector/securities GETF shall be benchmarked against the price of Gold.

5. Half Yearly Report by Trustees

Physical verification of gold underlying the Gold ETF Units shall be carried out by statutory auditors of mutual fund schemes and reported to trustees on half yearly basis. The confirmation on physical verification of gold shall form part of half yearly report by trustees to SEBI.