SBI Silver ETF NFO: Review, Opening Date & NAV

Introduction

Do you include yourself among those who want to invest in mutual funds and who are keen to show yourself as a leader in this market? Or do you want to invest your money to make it big?

We're back with another thought-provoking and informative blog post that can help you with your next financial step. So, this time, we've devised the business concept of the 'SBI Silver ETF'.

This article will describe what is included in the fund program and how it works.

 

Everything You Need to Know About SBI Silver ETF - NFO

SBI Silver ETF, created by SBI Silver Mutual Fund, is an open-ended mutual fund. Subject to tracking inaccuracy, the program seeks to produce returns that represent the performance of physical silver in domestic pricing.

The lowest investment required to join is Rs.5000 for investors and in multiple of Rs.1 thereof. The scheme is suitable for such investors who are looking for long-term wealth creation for 5 or more years and returns on investments that, although prone to tracking error, follow domestic silver prices. The scheme has no Exit Load.

To learn about the fund's asset allocation, and other financial characteristics that influence decision-making, carefully read this blog.

 

 

SBI Silver ETF - NFO Overview

The investment period for the Scheme is set for June 24, 2024, to June 27, 2024. The scheme is a very high-risk scheme. There is no assurance that the scheme's investment goal will be met. The scheme will invest in Silver and securities/instruments related to silver, Government securities such as liquid mutual fund units, Treasury Bills, Treasury Securities, SDLs, and Triparty Repo. The scheme has no entry load.

 

Fund Overview

The SBI Silver ETF has an AUM of Rs.4,707.32 crores (as of 31 May 2024), and the minimum subscription amount is set at Rs.5000.

Start Date	24 June 2024
End Date	27 June 2024
VRO rating	-
Expense ratio	NA
Exit load	Nil
AUM (Fund size)	Rs.4,707.32 crores
Lock-in	No Lockin
Stamp Duty	0.005% (From July 1st 2020)
Benchmark	Against the domestic price of Silver
Min. Investment	Rs.5000
Risk	Very High
Short-term capital gains (STCG)	For less than 3 years, as per Tax Slab
Long-term capital gains (LTCG)	For more than 3 years, 20% is applicable.

 

 

The Objective of the fund

The Scheme intends to produce returns that, allowing for tracking error, correspond to the success of physical silver in local prices. Nevertheless, there can be no assurance or guarantee that the scheme's investment goals will be met.

Asset allocation (% of Net Assets) of the Scheme's portfolio will be as follows:

Types of Instruments	Minimum Allocation (% of Net Assets)	Maximum Allocatio (% of Net Assets)	Risk Profile
Silver and/or silver-related instruments	95	100	Very High
Government securities, such as Triparty Repo, and liquid mutual fund units.	0	5	Low

 

Peers of SBI Silver ETF 

Index / Debt Funds	1Y Return	AUM (Cr)
Axis Silver FoF Regular-Growth	28.29%	41.85
HDFC Silver ETF FoF Regular - Growth	28.83%	89.47
Kotak Silver ETF Regular - Growth	28.36%	538.90

Risk Factors in Such Funds

• The worth of silver retained by the plan is correlated with the NAV of the units. The price and value of silver are subject to swings for a variety of causes, and any such changes will impact the NAV of units under the plan. The supply and demand for silver in the domestic and international markets, inflation and interest rate trends, trading in silver as a commodity, potential legal constraints on the movement and trade of silver imposed by the RBI, the Government of India, or other countries which supply or purchase silver to or from India, patterns and restrictions on the import and export of silver jewellery into and out of India, etc. are some of the factors that could affect the price of silver.

• A general drop in the price of silver could have an impact on the scheme's performance because it intends to invest at least 95% of the net assets in silver and/or securities related to silver. Regardless of their potential for profit, the Scheme makes investments in physical silver and/or silver-related instruments.

• Although this is an open-ended scheme, investors should be aware that they will still need to purchase or sell scheme units on stock exchanges where they are listed for liquidity at market price, in accordance with the exchange's laws and regulations.

• Since SBI Silver ETF is not an equity-oriented fund, it is possible that it will not offer the tax benefits associated with equity-oriented funds. For information on appropriate tax rates, investors should individually check with their tax professionals.

 

Past Performance of Index / Debt Funds

Index / Debt Funds	NAV (Rs)	Annualized Return (1Y)	Return/Risk
Navi Nifty Bank Index Fund - Direct Plan-Growth	13.48	18.86%	Very High Risk
Motilal Oswal S&P 500 Index Fund - Direct Plan-Growth	20.911	27.92%	Very High Risk
Invesco India Nifty G-Sec Sep 2032 Index Fund - Direct Plan-Growth	1107.65	7.58%	Moderate Risk

 

 

SBI Silver ETF NFO - Who can invest?

This fund is ideal for you if you are looking for long-term wealth creation for 5 or more years and returns on investments that, although prone to tracking error, follow domestic silver prices.

 

SBI Silver ETF NFO - Growth Fund Managers

• Vandna Soni
  
  

Conclusion

The scheme comes under a very high-risk category and it plans to invest in Silver and securities/instruments related to silver. The price and value of silver are subject to swings for many causes, and any such changes will impact the NAV of units under the plan. Prices of Silver are prone to fluctuating. Always assess your Financial Goals, Risk tolerance, etc. before making an investment decision. 

 

Disclaimer: This NFO analysis is provided solely for informative reasons and should not be construed as investment advice. Always conduct research and talk with a financial advisor before investing.