Do you want to make an investment in the gold market this holiday season? Here are a few of the best investment options
Physical gold purchases come with substantial costs for making and cost and quality issues such as leasing lockers, purchasing insurance, etc. to ensure the security of the gold.
The purchase of gold during the holiday time is a long-standing tradition in India. However, many prefer investing in tangible gold, in form of gold jewelry and gold coins during the festive season.
The purchase of physical gold particularly gold jewelery requires a substantial cost to make and has quality issues and associated costs, such as leasing lockers, purchasing insurance, etc. to secure the gold and safe, today's investors are gradually shifting to paper or digital gold.
In addition to security and convenience Some of the digital gold options come with tax advantages that are beneficial to the investors .
CA Ruchika Bhagat MD, Neeraj Bhagat & Co offers her thoughts about some of the options for digital gold that you might consider investing in during the holiday season:
"Being considered to be auspicious and a sign of prosperity, demand for gold is higher during festive occasions like Dussehra, Dhanteras, and Diwali. The past was when people purchased gold-plated jewelry and coins but in recent years, intelligent investors have also begun buying gold in paper forms , such as Gold exchange-traded fund (Gold ETFs) and Sovereign gold bonds (SGBs) that are issued through the Reserve Bank of India, and Gold Mutual Funds (Gold Mfs)," said Bhagat.
"One of the most profitable investments that people are looking for is investing in Gold. They can yield good returns, but many additional advantages are available to investors in the event we look at the income Tax," she added.
Bhagat provides the advantages of digi gold over traditional gold:
Liquidity
It is possible to buy or sell by pressing the button on your mobile phone, and without the requirement to go to the neighborhood Jewelry Shop. With the quick money transfer to an account is guaranteed that you have the most liquidity.
Little Savings? There's no need to worry...
You might think that investing in gold needs huge savings from your earnings. If so then this is the right opportunity the right opportunity for you. It is possible to begin making investments in Digital gold starting at Re 1.
There is no need to purchase 1 gm of gold, but its price is also quite too high. Digital gold provides the possibility with the smallest savings to make investments in Gold.
Purity
When purchasing digital gold you are assured that it is pure. There is no risk of fraud happening about its purity of which 24 carats are the standard. The total investment is Gold only.
Cost savings
When you purchase gold jewelry, you do not just have to pay the cost of gold, but also pay charges and other taxes.
Jewelers can charge anything from 7 percent to 25 percent based on the design of the jewelry. If the piece of jewelry has gems and precious stones it will cost more and the value of the item is added to the price of gold.
When dealing using gold jewellery, you don't have to keep or repair the value of the jewelry.
Security
Something that should be taken note of is that every grams of gold you put with Digital Gold is secured by physical gold that is owned by these firms. Therefore, security concerns are removed.
There are no storage issues
Are you concerned about losing your gold possessions, due to theft or other reason? You can go to the back for an item and pay annual fees for a locker. You can also put your money into Digital Gold, and the rest is guaranteed. All Digital gold is insured and protected in vaulted vaults that are high-quality.
Bhagat discusses some of the possibilities to invest into Digital Gold:
Sovereign Gold Bonds (SGBs)
They're a replacement for physical gold. Investors must pay for the purchase in cash and receive the entire amount upon expiration. It is considered to be a safe method of investing in gold particularly for those who have an investment plan that lasts for more than five years. There is a Reserve Bank of India (RBI) issues SGBs several times per year and determines an amount for each issue. Investors are able to use markets on the second side to buy the bonds.
The bonds provide investors with an interest rate that is guaranteed at 2.50 percent (fixed rates) per year for the initial investment. The investor is credited with the amount in interest over a semi-annually basis.
However, SGBs have a lock-in period of eight years, and the option to exit only in 5th, 6th and seventh years of the date of interest payments. In the event that investors wish to leave before five years, they have be able to trade the SGB through stock exchanges. Capital gains are not a part of these bonds.
ETFs of Gold
Gold ETFs permit investors to purchase gold shares in a format that is dematerialized that can be purchased and traded on the stock market as shares. Within the Demat ledger you will find an amount of Gold equal to physical amount in Gold in electronic format.
They are all available on the exchanges, and you can receive live updates regarding their prices. ETFs aren't subject to exit charges, meaning that buyers can purchase and sell them anytime during the market hours.
Gold mutual funds
These are typically open-ended funds which permit citizens to invest with no Demat account. Gold fund units are determined through the method the Net Asset Value which is reported at the close of trading hours. The scheme is managed by expert experts oversee your investments to generate wealth and decrease the risk.
The gold units can be exchanged by selling them back to the property according to NAV during the current day.
Gold Fund of Funds (FOFs)
They are funds that invest in a pool of mutual funds. They carry the cost proportion of individual funds with their fees, which can make it a bit costly.
"Buying gold is just a click away. It's easy to purchase the gold. You can easily check the gold online and purchase the gold effortlessly," said Bhagat.
No comments:
Post a Comment