If you’ve been wondering how to invest in gold, you’re not alone. Gold is one of the world’s most important metals and is used in a wide range of industries, from technology to medicine, and even space travel. It’s also a crucial commodity that can have a significant impact on the economy and various countries’ trade balances.
Gold is the precious metal that has been used as a store of wealth for thousands of years. It is not only seen as a hedge against inflation but also as an investment with potential for growth.
The gold market in India is among the world’s largest. The yellow metal is considered to be very auspicious in India and the country has a strong affinity for it. For this reason, many people opt to invest in gold for the security it gives them and the potential for growth it offers. Investing in gold is a popular idea since it’s a fruitful investment that can diversify your portfolio. You can buy gold coins and bars, SGBs, or even purchase gold as ETFs.
One can invest in physical gold by purchasing gold coins or gold bars from jewellers, banks or online stores (issued by MMTC), NBFCs etc. Gold coins are usually of standard denomination like 5 and 10 gm, while bars are of 20 gm.
Investing in physical gold is a traditional approach to invest in gold, that being said investors usually buy gold during a few auspicious days of the year.
Sovereign Gold Bonds (SGBs):
Sovereign gold bonds were introduced by the Government of India in 2015 under the Gold Monetization Scheme. The investors shall receive a fixed predetermined rate of interest during the term of the bond. Whenever an SGB issue is opened, investors can apply for it at bank branches, post offices, SCHIL or authorised stock exchanges directly or through their agents.
Another popular option of investing in gold is through gold Exchange Trade Funds. Gold ETFs are based on the price of gold, and investments are made in gold bullion. Gold ETF transactions are made through stock brokers, who will use the money you give them to invest, to buy gold at market rates. They are valued in terms of the price of gold.
Gold being a versatile investment, gives you a little bit of extra security and acts as a safety net that minimizes the risk of faling into financial troubles.