Its Best Time to Invest in Gold
Investment in Gold: Gold has traditionally been known as a major investment product in India. People buy gold every year on occasions like Akshaya Tritiya, Dhanteras, Diwali etc and use gold jewelery in almost every wedding ceremony etc.
This process is going on from generation to generation. There are more investment options than ever before. These include Digital Gold, Gold Fund, Gold ETF, Sovereign Gold Bond (SGB) etc.
In such a situation, in the matter of investing in gold, people’s attention has shifted from physical gold to paper gold. Why is it necessary to invest in gold, know further.
Why Invest in Gold
Inflation often reduces your investment returns. While gold is useful in hedging (hedge) against inflation.
So those who do not like to invest in gold, they should think again and must include gold in their portfolio. Know further what are the benefits of investing in gold.
High Return
Gold is a time-tested investment option that holds an edge over many other options available today. When valued in terms of fluctuating inflation rates, gold has traditionally performed well over the decades.
Hence it is a good option to hedge against inflation. In the last 30 years, in rupee terms, gold has given a return of 10 per cent annually.
In the last decade, gold has given an annual return of 11 per cent. During the same period, the CPI (inflation) index stood at 6.3 percent. This makes it quite clear why gold is essential to avoid inflation over the long term.
Safe Investment Option
It is said that inflation or not, gold must be a part of an investor’s portfolio. Apart from inflation, there are many other factors and risks that can have an adverse effect on investing in stocks.
These include geopolitical tensions like the one we recently saw between Ukraine and Russia, or another disaster like the COVID-19 pandemic.
In such a situation, gold is a tried and tested safe haven investment option for investors. Hence, it is advised that investors should invest as much as 10-20 per cent of their portfolio in gold.
Reliable Investment Option
Apart from being a good investment option, gold has many other uses. While jewelry is the first thing that comes to mind when talking about gold, it can also be used to take loans in times of need.
Gold loans are generally low-interest loans that borrowers can avail quickly without any hassle. And unlike other loan options available, gold loan interest rates are also low.
In this way the financial interests of the borrowers are protected. Similarly, by investing in gold, you get many advantages like its high liquidity, disaster-proof nature.
