Therefore, it came as a shock last year (2011) when it became known the top management and shareholders of BAMC were selling out the fund and schemes to Goldman Sachs. It became clear to ETF investors that Goldman Sachs will not be interested in doing much justice to the running of ETF schemes and will expend their time and energies in coming out with, and managing, actively-managed schemes.
This is already seen to be happening. After acquiring Benchmark Mutual Fund in July 2011, Goldman Sachs India Mutual Fund, the new name of the fund, began filing offer documents with the regulator for the launch of actively-managed equity schemes. The first one was launched last month (October 2012).
But what is the most dismaying is that investors in the erstwhile Benchmark Nifty ETF, now known as GS Nifty ETF, are being hit due to the deliberate negligence of Goldman Sachs. Sadly, the shareholders and management of BAMC betrayed the trust put in it by the investors by selling out to Goldman Sachs and got big cash as a result.
Below is a news analysis I did recently for the newspaper I work on how the performance of GS Nifty ETF has lagged peers since the July 2011 acquisition.
Here is what I wrote:
Goldman Nifty ETF lags peers post-Benchmark acquisition
The re-christened Benchmark Nifty ETF gave 1.2 per cent return against 2.9 per cent of peers
|GS Nifty ETF||Quantum Nifty ETF||Kotak Nifty ETF||TRI Nifty|
|Jul '11* to Nov '12**||1.20||2.95||2.85||3.14|
|Jul '10 to Jul '11*||5.91||5.63||5.82||6.16|
|Jul '09 to Jul '10||23.90||23.68||NA||24.77|
|Figures represent returns based on monthly average NAVs/index values|
|Nifty TRI: Nifty Total Returns Index|
|* till 13th|
|** till 9th|
|Source: Respective MF websites, NSE. Analysed by FC Research Bureau|