Submitted by admin on April 5th, 2024
Gold prices have been skyrocketing in India. On Tuesday, it touched a new high, supported by momentum-following funds that stand strong against the US dollar. Spot gold rose 0.5% to $2,262.51 per ounce by 1055 GMT to set a new record at $2,266.59.
Different Forms of Gold Investment
There are two types of gold investment- Physical and Digital.
The physical gold investment includes investment in raw gold, gold bars, gold coins, and gold jewelry.
Digital gold investment includes investment in gold mutual funds and gold ETFs, gold bonds, and via relevant online platforms.
Each gold investment option has its own set of merits and demerits.
In this blog post, we will cover all important aspects to help you make an educated decision regarding physical gold investment.
| Physical Gold Investment | Digital Gold Investment |
| Investment in raw gold, coins, bars, gold jewelry | Investment in gold bonds, gold ETFs and other online platforms. |
| The investor can physically hold the gold and has the responsibility for storage and security. | The investor does not hold the gold physically but holds its digital representation. |
| Purchased and sold through jewelers, banks, and digital marketplaces. | They were purchased & sold via digital platforms, stock exchanges, and fund houses. |
| It involves storage and insurance costs. | It doesn’t require any storage or insurance costs. |
| A strong sense of tangibility and security is ensured. | Any such feeling is absent. |
| Buying and selling involve physical time and effort, | Convenient purchase and sale on a stock exchange or digital platform |
| Prone to damage, loss, and theft | Safely stored digitally or in a suitable account |
| Involves making charges | Platform fees are added to the overall investment costs. |
I’ll advise you to set aside 10-15% of the portfolio value for gold investment as a form of diversifying investment strategy.
However, it is important to acknowledge that no one-size approach fits all when looking for a suitable gold investment.
Physical Gold Investment: Important Suggestions
It’s the best form of physical gold investment. The easiest and safest way to buy genuine raw gold is to approach a trusted jeweler.
The flipside is: that there is no ready market for investing in raw gold. No bank or digital platform will allow you to deposit your raw gold. You have to sell it to a jeweler, preferably where you got it from.
In India, raw gold is not included in the list of regulated commodities. Hence, there is a high risk of misrepresentation or fraud.
Gold Bars & Coins
These are the best options only next to raw gold in terms of physical gold investment, with potential losses restricted to only 2-3%.
Tanishq, Kalyan Jeweller, MMTC-PAMP, etc are the most trustworthy sources for gold bars and coins (both 22K and 24K).
Banks also sell certified gold coins.
Look for BIS hallmarking and ask for a purity certificate while buying gold bars and coins.
Pure Gold Ornaments
Jewellery is the lion’s share of 25, 000 tonnes of physical gold owned by the Indians.
Pure gold ornaments are 22-karat gold products with 91.6% purity. Gold jewelry is a cultural and status symbol for the Indians, apart from being a solid investment option.
24-karat gold has 100 percent purity but is unsuitable for jewelry marking because the brittle may cause jewelry brokerage.
Int Rates : 10.5% - 22%
Loan Amount: ₹ 1,00,000.00
Maximum Tenure - 7 Years
Lowest EMI : ₹ 1,686
Interest Rate 13.99% - 24.99%
Loan Amount: ₹ 1,00,000.00
Maximum Tenure – 5 Years
Lowest EMI : ₹ 2,326
Interest Rate 9% - 13%
Loan Amount: ₹ 1,00,000.00
Maximum Tenure – 20 Years
Lowest EMI : ₹ 1,014
Interest Rate 8.40% - 12%
Loan Amount : ₹ 1,00,000.00
Maximum Tenure – 35 Years
Lowest EMI – ₹ 739
