Indian exchange-traded funds are gaining popularity in the high net worth sector as more investors look for alternative places for their money, reports India's Business Standard.

In a recent study by the Association of Mutual Funds in India, net inflows into gold ETFs went up from Rs133 crore (Rs1.330 billion, around $27.6 million) in 2008 to Rs176 crore during the period under review this year, a 32 per cent rise. A separate survey by the World Gold Council also reveals that holdings in Indian households account for around 10 per cent of the world's gold stock, or around 15,000 tonnes of gold.

UTI Mutual Fund chief marketing officer Jaideep Bhattacharya was quoted to have said that the high net worth market's attraction to gold ETFs is attributable to the product's low-cost model. "Around 96 per cent of investment products in India are sold on distributor recommendations. However, with the Sebi ban no entry load, gold ETFs will find more acceptance," he said.