Ever since the valuable yellow metal gold was discovered, it has been rated as an ideal long-term investment to meet future requirements. It has always been considered a safe investment to tide over situations like economic volatility, fluctuations in currency, inflation as well as conditions of war. There are multiple ways to invest in gold. You can invest in gold bonds, jewellery, gold coins or bars, and sovereign gold bonds. Some individuals prefer to make investments in gold ETFs. These are gold exchange-traded funds. Many prefer to invest in Gold FOFs. These involve gold investing in a collective number of mutual funds. There are many trusted financial institutes and renowned banks tell you how to invest in gold online. You can also invest in gold mining companies. Gen Z has also taken to exploring gold investment options as they believe it is a secure and robust investment.
Did you know?
Gold is not impacted by the harshest chemicals, but it dissolves in mercury.
What are Some of the Various Gold Investment Plans?
When you compare the earlier history of gold with its current status, you will realise that the options of investing in gold are manifold. Given below are details on some of the most attractive investments:
Jewellery made of gold is accepted as an invaluable investment across the world. Gold jewellery serves as a potent source of revenue, especially during inflation. Gold jewellery in the form of necklaces, wrist bands, bangles or even anklets, and waistbands make for good investments, but investors often forget to take the making charges into account. The demand for gold jewellery is always on a high. In India, gold holds an emotional value for most individuals, and while it is a good physical investment, it provides attractive returns only when inflation levels are low. Though this metal lures people, you should remember that this is a fixed investment that does not furnish you with intermittent returns like dividend payments in shares. In simple words, you do not earn any returns on it consistently.
Investing in Solid Gold – Gold Biscuits, Gold Bars, Gold Coins
Before making such investments, you should acquire knowledge about the monetary value of investing in each of these.
Most gold coins that are purchased range between 22-24 karat, and their weight varies between 0.5-100g. Many goldsmiths also craft coins weighing between 1g-8g. You should always check for the Hallmark icon as that indicates the purity of the gold. Some business enterprises and commercial goldsmiths craft gold coins with historical faces of Hindu deities. These types of coins tend to carry a different value, i.e. historical value and the quantity of gold is less. The ones which symbolise historic faces or images are termed collector’s gold coins and are highly valued. You can make investments in gold coins by purchasing them at reputed jewellery stores. Many banks sell these, especially during festive seasons. You can also purchase gold coins from reputed e-commerce websites. This type of investment includes nominal making charges. You can always sell them in exchange for jewellery by investing a little more or cash whenever the occasion demands. Gold coins make for great gifting merchandise to near and dear ones.
Many individuals like to invest in gold bars. These have become a preferred choice among many as they can be liquidated with ease and smoothly converted into cash.
Like gold bars, gold biscuits are a long-term investment and include the making charges are nominal. These can be liquidated with ease and are available across gold jewellery stores, websites, and small gold retail outlets. Gold biscuits are said to have a purity of almost 99.50%. Almost all gold jewellery has some percentage of different alloys which reduces the purity of gold, making gold biscuits highly valuable. Moreover, unlike jewellery, gold biscuits are easy to sell and make profits off of.
One of the safest and most practical gold investment options is that of digital gold. You can buy digital gold for as low as ₹1 only. The gold you purchase is safely locked away in the vaults by the gold seller. This type of gold is 24 karat with a purity percentage of 99.5. Easy to liquidate, you can sell it whenever you choose to. These work as a security against any online loans you may wish to take. You can always exchange your digital gold for gold coins or jewellery. However, you have to make a minimum investment of ₹2,00,000. In some cases, you can incur delivery charges. Most importantly, digital gold is neither regulated by the Securities Exchange Board of India nor by the Reserve Bank of India. You can buy or invest securely in digital gold on Khatabook app with all ease.
Also Read: A Brief Overview of Gold Loans
Sovereign Gold Bonds
The Reserve Bank of India issues sovereign gold bonds in accordance with the rules laid down by the Government of India. They are ideal for individuals who like less volatile investments. The purchase and sale of these types of investments involve cash payments. Investors can earn 2.50% interest in a year and can make profits only when the price of gold increases. However, an investment in gold bonds involves a lock-in time frame of eight years.
Gold Exchange Traded Funds (ETF) is another safe option for gold investing. You can make as low an investment as 1 gram. You are not restricted by a time frame. You can yield profits in accordance with the market gold prices. The key requirements for this are:
- Demat account
- Trading account
Once you open these accounts, you can make an appropriate selection based on your understanding of the stock markets and invest accordingly. Gold ETFs are a feasible option to have a diversified portfolio.
Gold Fund of Funds involves mutual funds. The Securities and Exchange Board of India regulates Gold FOFs. These are open-ended funds and are made in distinct units of gold exchange-traded funds. You can start with a systematic investment plan that involves a small amount of ₹1,000 per month. You can also withdraw the money in accordance with the same method. All the profit that accrues on these investments is taxed.
Gold has never ceased to attract buyers across the world. The above details guide you on the various gold investment plans.
Follow Khatabook for the latest updates, news blogs, and articles related to the gold industry.