UTI Mutual Fund announced the launch of the UTI Silver Exchange Traded Fund (ETF), an open-ended index fund scheme replicating/tracking the domestic price of silver (based on LBMA silver daily spot fixing price).
The scheme opened for public subscription on April 10, 2023, and will close on April 13, 2023. The scheme will re-open on April 20, 2023.
Q. What kind of mutual fund scheme is this?
This is an open-ended scheme replicating/tracking the domestic price of silver.
Q. What is the main objective of investing in this fund?
The investment objective of the scheme is to generate returns that are in line with the performance of physical silver in domestic prices, subject to tracking error. However, there is no guarantee or assurance that the investment objective of the scheme will be achieved.
Q. How may one invest in this scheme?
Investors can invest under the scheme with a minimum investment of ₹5000 per plan/option and in multiples of Re 1. There is no upper limit for investment.
Under normal circumstances, the asset allocation of the scheme will be as follows:
| Instruments | Indicative Allocation (% of total assets) | Risk Profile | |
| Minimum | Maximum | ||
| Silver and Silver related instruments with Silver as Underlying | 95 | 100 | Very High |
| Money Market Instruments including Tri-Party Repo on Government securities or Treasury bills, cash & cash equivalents | 0 | 5 | Low to Moderate |
Q. Are there similar mutual funds in the market?
To date, many asset management companies (AMCs) have launched such silver exchange-traded funds (ETFs), thus, allowing inclined investors to avail of returns corresponding to the total returns of the securities in this particular index. These include:
| Name of the fund | One-year returns (in %) |
| Nippon India Silver ETF | 11.18 |
| ICICI Prudential Silver ETF | 11.05 |
| Aditya Birla Sun Life Silver ETF | 13.05 |
| Source: MoneyControl | |
Q. How will the scheme benchmark its performance?
The domestic price of silver (based on LBMA silver daily spot fixing price) is the benchmark. The performance will be benchmarked to the Total Returns Variant of the Index. However, UTI AMC reserves the right to change the benchmark in future if a benchmark better suited to the investment objective of the scheme is available.
Q. Are there any entry or exit loads to this scheme?
This scheme involves no “Entry Load”, which means that investors do not have to pay anything to park their earnings in this scheme. The “Exit Load” is also “Nil”.
Q. Who will manage this scheme?
Niranjan Das is the designated fund manager of this scheme.
Q. Does the fund contain any inherent risk?
The scheme involves “Very High Risk” as per the details mentioned in the Scheme Information Document and is best suited to investors willing to understand that their principal will be subject to very high risk only. However, investors should consult their financial advisors if they doubt whether the product is suitable for them.
