Indians love to buy gold especially on occasions like Dhanteras and Akshaya Tritiya. According to Hindu religion investing in gold, silver, platinum, real estate on such occasions is considered auspicious.
The downtrend seen in gold prices is expected to boost the demand for gold. This Akshaya Tritiya try investing in gold other than physical form.
Here are few different ways in which you can invest this Akshaya Tritiya.
e-gold is similar to shares, where you can hold the same in an electronic form. Interestingly however, you can convert the e- gold into physical units anytime you want. one can buy e-gold by registering with the depository participants listed with the NSEL. There are very nominal holding charges for e-gold.
Gold Exchange Traded Funds (ETF)
The increasing popularity of exchange traded funds on the bullion markets makes for an ideal way to invest. ETFs are a type of mutual fund which invests the money accumulated from investors in gold. Buying gold ETFs is like purchasing gold in electronic form and can hold it in terms of units and each unit represents one gram of gold. Some of the Gold ETFs available in India are Motilal Oswal MOSt, Canera Robecca, Kotak Gold ETF, UTI Gold ETF, Reliance Gold ETF etc.
Gold futures trading was enforced in 2003. In India it is traded on the Multi Commodity Exchange (MCX) platform, where one can buy, sell and gold futures. Trading in futures market is too complex and involves high risk. Investors who have the knowledge and expertise can consider this form of investment.
Gold saving funds
Gold funds are those which form a part of Mutual fund product, however, one should not confuse with gold etf as both are different from an investment avenue. Gold funds are equity oriented schemes which invest in gold ETFs, which are listed on the stock exchanges. They invest in companies which belong to gold sector.
Gold coins and bars are the best way to invest in physical gold. Gold coins can be bought in denominations of 10 gms, 20 gms, etc., and gold bars are available in denominations of 1gm, 2 gms, 5 gms, 10 gms, etc. Buying gold coins from an authorised dealer makes sense as the purity and quality is assured.
This is a traditional way of investing which has carried on for years, though it may not be an ideal way. If you consider Gold jewellery as an investment option, then it may not be an attractive proposition as buying jewellery comes with labour and design charges. 24-carat gold is considered as the purest form of gold, while jewellery is usually made up of 22-carat rather than 24-carat.