Gold Investment: Since the vaccination has started in different countries for the prevention of the coronavirus epidemic, the attractiveness of gold has also decreased. Due to the strong boom in the stock market due to the sentiment of economic recovery, investors have withdrawn money from gold and put it in equity. During this time, gold has become about 10 thousand rupees cheaper than its record high. Is the current fall in gold a new investment opportunity? Experts believe that gold has always been giving good returns in the long term, even if it shows pressure from time to time. But it has been getting steady returns. In such a situation, investors should invest money in gold to balance their portfolio. The allocation should be 5 to 20 percent depending on the risk taking ability.
Gold from 5 to 20% in the portfolio
Nish Bhat, Founder and CEO of Millwood Cane International, says investors’ portfolio should contain 5 to 20 per cent gold depending on their risk appetite. Right now, gold has fallen significantly from record highs, so there is a right investment opportunity. Factors such as the Corona vaccine, rally in the stock market, rise in bond yields and improvement in the dollar have been the reasons for the decline. However, high valuations of the stock market, economic recovery, new variant of COVID 19, factors like liquidity can drive gold prices.
Gold bond is a better option
Experts say that Sovereign Gold Bond is a better option for investing in gold. The 12th series of gold bonds has also opened for investment from March 1, which will remain open till March 5. This time for gold bonds, the government has fixed the issue price at Rs 4,662 per gram, ie Rs 46,620 per 10 gram. At the same time, if you buy gold bonds online, then a discount of Rs 50 will also be available on every gram. For online investors, the issue price will be Rs 4,612 per gram i.e. Rs 46,120 per 10 gram.
Why is there a benefit in buying gold bonds
1. Apart from the rise in gold prices, you also get additional interest at the rate of 2.5 percent.
2. It is tax free on maturity.
3. The expense ratio is nothing.
4. There is no risk of default by being supported by the Government of India.
5. It is easier and safer to manage than physical gold.
6. There are easy exit options.
7. Against gold bond facility.
8. It is also a better option for HNIs, where it does not have to pay capital gains tax to hold till maturity. Equity attracts 10% capital gains tax.
9. There is no hassle of purity in this and prices are decided on the basis of pure gold.
10. Talking about the last 10 years or 15 years, gold has consistently given good returns.