5 Smart Ways to Invest in Gold in India

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From the traditional ways to invest in gold mainly through jewellery, the last few decades have thrown-up a host of opportunities to invest in gold. Here are a few ways to invest in gold in India.

5 Smart Ways to Invest in Gold in India

Gold Futures

You can buy into gold futures, which are traded on the MCX. These future prices tend to track gold prices, and the contracts have to be settled with a pre-determined period.

For example, if you buy a gold contract of Sept expiry, you have to make sure you settle the same by Sept.

Gold Futures are risky, as you have to settle the contract, even if you make a loss. In case of gold coins and bars, you can continue to hold the same, if you incur a loss. The one advantage of buying gold in the futures market is that you have to pay only a 10 per cent margin. For example, if you buy 10 grams have gold valued at Rs 27,000 in the physical market, here you can pay just about Rs 2,700 as margin money.

Gold ETFs

There are various Gold Exchange Traded Funds (ETFs) that investors could buy. Gold ETFs are better than physical gold, and offer many advantages. Nobody can steal gold ETFs as they are in the electronic form. On the other hand, you do not have to incur storage charges. Taxation on Gold ETFs is done in the same manner as physical gold.

Read on 5 top gold ETFs that investors could buy here

Gold coins and gold bars

You can invest in gold coins and bars, by buying them from your jeweller or from the bank. However, gold coins and bars from the banks are assured of quality, while jewellers also guarantee quality and purity and could offer you a price that is slightly lower than that offered by banks.

Investing in gold coins and bars is not a good idea, as you have to incur cost for storage.

Also read a few steps to take before buying gold coins and bars in India here

E gold

You can invest in e-gold just as you invest in shares. The e-gold is held in electronic form or demat form, just like shares. This is perhaps one of the best ways to invest in gold and perhaps the cheapest.

Read complete details on How to invest in egold here

Gold Jewellery

This is the traditional way to invest in gold. However, these days individuals do not prefer this means of investing and buy jewellery only if there is a special need like marriage or birth in the family.

Sovereign gold bonds

The best part of these funds is that you get an interest rate of 2.75 per cent and were largely isssued to discourage the use of gold consumption in the country. They are a good alternative to physical gold.


The traditional form of investing in gold is slowly making way for other ways to invest in gold, particularly gold futures.

Of course, it is the best way to invest, as you could be saving money and charges like locker rents and with no worries of theft.


Read more about: egold, mcx, gold etfs, gold
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