Axis MF Launches Shagun SIP: Invest in Grams of Gold & Silver

Axis Mutual Fund has introduced “Shagun SIP,” a new digital investment feature that enables investors to set a target for accumulating a specific quantity of gold or silver in grams over a chosen period. This approach contrasts with conventional Systematic Investment Plans, which typically involve a fixed monthly rupee amount.

Under the Shagun SIP, the system dynamically calculates the required periodic investment based on current market prices. This means the rupee amount invested will fluctuate, increasing if gold or silver prices rise and decreasing if they fall, while the gram-based target remains constant.

Dynamic Investment Calculation

For example, an investor aiming for 5 kg of gold over a decade will see their monthly rupee contributions adjust. This mechanism helps spread purchases across various market price points, potentially averaging the acquisition cost over time.

The Shagun SIP is specifically applicable to the Axis Gold Fund and the Axis Silver Fund of Fund. These underlying funds invest in high-purity gold at 99.5% and silver at 99.9%, respectively.

Key Features and Accumulation Targets

A crucial aspect of this offering is that it does not involve the physical delivery or storage of the precious metals. Investments are facilitated through Axis Mutual Fund’s existing fund structures, eliminating concerns related to physical security or purity.

Investors can set substantial accumulation targets, with the program allowing for up to 25 kg of gold or 50 kg of silver. This provides a structured method for building long-term holdings.

Expert Perspective and Market Risks

Boniface Noronha, Chief Digital Officer at Axis Mutual Fund, stated that Shagun SIP provides a “fully digital, goal-based experience for investors seeking to build long-term gold and silver holdings systematically.” This emphasizes the convenience and strategic nature of the new feature.

However, it is important to note that while this method averages acquisition costs, it does not remove the inherent market risks associated with precious metal price volatility. Investors remain exposed to price fluctuations in the gold and silver markets.

This innovative Shagun SIP offers a distinct pathway for Indian investors to systematically accumulate precious metals, focusing on quantity rather than fixed monetary contributions, though market risks persist.