What could be more prominent than the Golden Temple to understand the importance of gold in Punjab and its culture? One of the most prosperous states situated in Northern India, Punjab is known as India’s wheat bowl. Amritsar, Ludhiana, Chandigarh, Jalandhar, Patiala, are some of the major cities in the state. Traditionally, gold here is passed from generation to generation. 

Gold, since ancient times, has been a symbol of prosperity and wealth. Its increasing prices and stable market position make it an important part of any healthy investment portfolio. Gold is a limited supply commodity and available at today's gold rate in Punjab. Being one of the richest states in India, gold rates in Punjab may be a bit higher when compared to other states. So, what makes gold such a viable investment option at the present gold rate in Punjab? Read on to know more about it.

What is Today’s Gold Rate in Punjab?

As of 17th November 2024, the 22-carat gold rate in Punjab is ₹ 0/gm. The 24-carat gold rate in Punjab is ₹ 0/gm.

Gold Rate in Punjab For The Last 10 Days

Performance of gold with 22k gold rate today in Punjab and 24-carat gold rate in Punjab over the last 10 days.

Historical Prices of Gold Rate in Punjab:

 Tip: The gold rate in Punjab may rise and fall, though the performance of gold shows a steady rise upwards over longer periods.

Also Read: Steps to Calculate the Gold Price for Jewellery

Factors Affecting the Gold Rate in Punjab

Gold investors look for safety, liquidity and Return on Investment when investing in gold. The following factors play a significant role in how gold prices are determined:

Final Price of Jewellery

Some additional factors affect the final retail price at which you buy gold from any shop.

• Futures Trading: Any commodity, no matter how stable, is vulnerable to selling and buying trends. That is the basis of the whole demand-supply chain and the change in prices. It is true for gold too. To secure its position in the market, MCX, Multi Commodity Exchange of India Ltd. trades in futures gold contracts that help build a trend. The prices determined by MCX become a standard for daily pricing.
• IBJA: The Indian Bullion Jewellers Association works at a national level to determine daily gold prices. It consults the 10 biggest gold dealers in the country and takes into account all the legal gold sold and bought in India before deciding on the daily gold rate. 
• Taxes and Making Charges: Gold jewellery, the most common form of retail gold purchase, involves taxes and making charges. Depending on their practices, jewellers determine wastage and making charges accordingly. A GST of 3% on the piece of jewellery and 5% on the making charges is added to the total amount you pay to buy the ornament.

So, the way the final jewellery price is calculated looks something like this:

gold weight in grams x the gold rate in Punjab + Making charges (inclusive of 5% GST) + 3% GST on the jewellery price 

Also Read: What is Gold Standard and How Does it Work?

Gold Investment Options in Punjab

You can invest in gold either in its physical form or in the form of bonds or gold funds, depending on the kind of returns you are expecting. 

Physical Gold: One of the traditional and common ways of investing in gold is buying it in the form of jewellery. However, there are gold coin schemes, gold savings schemes (offered by jewellers) or gold bars offered by banks that you can invest in. Jewellery ownership does, however, present its own set of concerns regarding safety, high cost, and outdated designs. There is also the issue of making charges over and above the gold rate in Punjab, which could prove costly. Besides insurance, you will need to pay for safe storage as well.

Digital Gold: Those interested in long-term investments can purchase e-gold in small quantities and hold it in a Demat account. Once they have achieved the target, they can either take physical delivery of gold or encash electronic units at the gold rate today in Punjab 22K. One of the major advantages of this product is its price transparency and seamless trading. 

Gold ETFs: Gold ETFs are units that represent physical gold, which can be in either paper form or a dematerialised form. A Gold ETF unit represents one gram of gold and is backed by pure physical 24K gold. They are a combination of both gold and stock investments that offer all the benefits of both. The National Stock Exchange of India (NSE) and the Bombay Stock Exchange Ltd. (BSE) list and trade gold ETFs like other securities. A Demat (Dematerialised) Account is mandatory for investing in Gold ETFs. 

Sovereign Gold Bonds: The SGBs are bonds released by The Reserve Bank of India on behalf of the GOI. You can buy these bonds through banks both in the private and public sectors. The bond prices are linked to the gold rate in Punjab. It does offer a 2.5% return and is typically issued for 8 years with a lock-in of 5 years. 

Comparative Analysis of Gold Investment Options

Let's understand how gold investments differ:

Physical Gold: This investment is made in physical gold like bullion/jewellery. The gold jewellery price includes making charges, GST, and the cost of the gold per gram. There is a risk of burglary in such investments and an extra charge for insurance. Although it has no paperwork hassles, its BIS certification and receipt are essential when selling.

Gold Funds of ETFs: Gold ETFs trading is similar to trading in shares. You do not have to deal with physical gold, minimising the risk factor of theft and extra charges like insurance or making charges applied to gold jewellery. Gold funds are invested exclusively in companies involved in gold mining. Fund management charges are added to the 916 gold rate in Punjab today by gold funds. Paperwork is required when investing in these, and the maturity certificate is required when it is traded in. Gold funds depend on profits made by gold mining companies and not on the gold rate in Punjab (916) today.  

Digital Gold: The investment is made digitally and accumulates units of gold, where 1 unit is a gram of gold. Since it is paper-gold until delivery, there is no risk of theft. The paperwork is simple, and the gold is stored in an insured vault until it is delivered. The gold rate in Punjab 916 affects the price directly.

Tip: Digital Gold investments require a Demat account to be opened, unlike SGBs and other FDs.

Comparative Analysis of Gold Versus FD Investment Options

Here’s the performance comparison of gold investments versus FDs.

Risk Factor: Fixed deposits and gold are both low-risk investment options. However, gold can fluctuate somewhat over the short term but has maintained its value over time. Gold has served as a hedge against inflation and the erosion of major currencies, thus making it a worthwhile investment throughout the years. In contrast, FDs are free of external considerations and offer guaranteed returns, but it all depends on the length of time you invest. The longer your tenure, the greater your return.

Premature Closure or Liquidity: In terms of ease of liquidity, gold is the preferred choice among investors seeking a quick buy-in. Investors need to know how the market conditions are before purchasing or selling gold, as returns on gold will be greatly affected by market conditions. Fixed deposit plans usually restrict you to the liquidity policies of the financial institution you choose. It is possible to liquidate a fixed deposit before its maturity date, but most institutions will charge you with penal interest. Consider investing in FDs from companies that offer a penalty-free exit if you think you may need money before maturity. 

ROI Analysis: Gold investments can generate a substantial return on your investment. It is worthwhile investing in gold since historically it has provided inflation-beating results. A fixed deposit, on the other hand, has a fixed return set by the bank when the account is opened. FDs offer guaranteed returns, regardless of the amount you deposit. As compared to general citizens, senior citizens enjoy a higher interest rate of 0.50%-0.75%.

Important Factors When Buying Gold Jewellery

Since gold jewellery is the most prevalent kind of investment done across the country and in Punjab, here are a few things to keep in mind:

• Purity levels: One easy way to determine purity is to check for hallmarking. The hallmark on the jewellery indicates the official amount of metal in the alloy. Gold jewellery is certified and hallmarked by the Bureau of Indian Standards (BIS). Though 24K gold is the purest form of gold available, most jewellery brands sell ornaments of various purity levels, like 22K, 18K, 10K, 14K gold etc. Always remember to get the BIS certificate and receipt of purchases made.
• Daily Gold Rates: Gold rates vary daily, across locations and even by the moment on the commodities market. If you are considering investing in gold, look at the current gold rate in Punjab 916, the alloy metal rates and the 22k gold rate in Punjab, and if buying 18K gold, refer to the rate of 18-carat gold in Punjab today before you make your decision. 
• Buy-back terms: Many local and branded stores offer a gold buyback program in which they will give you 100% of your gold value. The best way to sell jewellery is to go back to the store where it was purchased. However, you will have to let go of the making charges and other expenses associated with it.
• Wastage and Making Charges: All jewellers charge a making charge to offset labour costs associated with jewellery. In most cases, making charges are based on the current gold price. Machine-made jewellery or jewellery without much artistic design will generally carry a lower making charge and range between 6% and 14% of the gold price. Jewellery with intricate designs may incur higher charges, going up to 25% of the cost of gold.

Tip: Buy 916 jewellery since it sells for more when resold than 18K gold.

Also Read: What are the Smartest Ways to Invest in Digital Gold?

Types of Gold

Comparative Chart for 22K, 24K and 18K Gold:

Digital Gold 

Investing in digital gold allows you to buy 24 Karat pure gold, which is stored in an insured vault, and own completely at the same time. You can exchange your digital gold for 24 Karat gold coins and ingots or gold ornaments at any time. You can start buying even fractions of digital gold units at the day’s price with your small investments on the Khatabook digital gold platform thus leveraging not just the day’s prices but also your returns on small investments.

Trading Digital Gold

You can sell or convert digital gold from home into physical pure gold bars and coins at will. Log into your account, enter the gold weight and choose the sell option using your mobile phone. By simply ordering gold jewellery on the phone, you can convert the gold to physical form and have it delivered to your home in a tamper-proof package. 

What is a Gold Loan?

A gold loan involves the bank, gold loan companies, etc. taking your gold as collateral for a short-term loan period. After you pay off your loan in full, the bank returns the jewellery to you. Gold jewellery 18K to 24K, is the only type accepted by most banks. Gold loans are usually provided for a maximum loan-to-value ratio of 80% - 90% of the current market price of gold. Gold, which serves as collateral, is evaluated by the bank, based on which it decides the maximum loan amount and interest rate. According to your loan terms, you should be able to choose from 6 to 24 months to repay the loan. Default in repayment causes you to forfeit the gold which is then auctioned by the bank.

Locations to Buy Gold in Punjab:

Gold jewellery can be bought at today’s gold rate in Punjab, across its major cities, which have reputed jewellery stores like:

Tip: You can buy online jewellery at the present gold rate in Punjab from reputed websites like Tanishq, Bluestone, Joy Allukas, Kalyan Jewellers etc. 

Conclusion

Gold investment is a safety net. That’s why most financial consultants suggest a balanced portfolio should have a portion of it held in gold. Physical gold carries a risk of theft, and low returns unless held for a long term. SGBs are suitable if one can stay locked in for greater than 5 years and up to 8 years. If planning to invest for 3 years or lesser, then digital gold, ETFs, and mutual funds are a good choice scoring on availability, liquidity and better returns. Make a wise choice and invest safely in digital gold using a trusted platform like Khatabook.