Gold has been a significant investment option for people for centuries. Back in the day, people had only limited ways to invest in gold as they either had gold in solid form or in the form of jewellery. However, today when times have changed and the world has become advanced, people have multiple ways to invest in gold and get great returns over time.
Here, we are going to learn about why you should invest in gold and what gold investment options you can consider. So, let’s take a dive into the topic and understand its fundamentals.
Reasons to Invest In Gold
Gold, whether you buy digital gold or physical gold, holds timeless value. However, there are many other reasons why investors turn to gold. Major ones include:
Safe Investment
Gold is one of the few things that is capable of retaining its value even during times of economic instability or geopolitical tensions. So, when you invest in gold, you can remain assured about its value and good return.
Shields During Inflation
When you take a look at the history of gold, you will find that it has always served as a safeguard against inflation. Consequently, when you are invested in gold and face tough events like inflation, you will still be able to preserve your purchasing power.
Diversification
To diversify your investment portfolio, you can also consider investing in digital gold, solid gold, gold schemes, etc. It is because when you include gold in your portfolio, it reduces overall risk, as its price movements often differ from those of stocks and bonds.
Capital Appreciation
Though it is not guaranteed, gold also has the potential to increase in value over the long term and this way you can enjoy capital gains over a period of time.
Store of Value
Gold has been recognised as a store of value for centuries as it offers stability in uncertain times, whether it is in the form of virtual gold, physical gold, or jewellery.
5 Major Ways To Invest In Gold
Here are the major ways you can consider to invest in gold:
Solid Gold
Solid gold, otherwise called physical gold, is usually in the form of coins and bars. These gold coins and bars have been the most traditional forms of gold people have invested in. You can purchase them from reputable dealers and store them in your private spaces or secure vaults for safety. As physical gold is a tangible property, it provides you with a sense of security. However, it may cost you storage fees and insurance fees.
Digital Gold
Today, when everything has come online, you also have the option of virtual gold investment. There are several online platforms and apps like CASHe where you can buy or sell gold electronically for whatever amount you wish to invest. This digital gold would be stored on a blockchain and backed by physical gold stored in secured vaults. The best part when you buy digital gold online is that you can invest from anywhere in the world. Also, you would not have to worry about its storage.
Jewellery
Quite a popular form of gold investment! While jewellery serves a dual purpose as you can wear it as well as consider it an investment, it is essential to consider factors such as craftsmanship and design when buying jewellery as an investment. Moreover, you should be mindful of markups and resale value when purchasing gold jewellery.
Sovereign Gold Bonds
Sovereign Gold Bonds are issued by governments and like digital gold, these are also backed by physical gold. These bonds offer you a fixed interest rate along with the potential for capital gain, though it is based on changes in the price of gold. Sovereign Gold Bonds can be purchased through designated banks or financial institutions during specific issuance periods. You can hold these bonds in paper form without the need for physical storage.
Also Read: 5 Proven Strategies To Quickly Clear Your Debts
Gold Schemes
You can also consider investing in gold schemes offered by governments or financial institutions. Here, you can regularly contribute a fixed amount towards purchasing gold. These schemes often come with attractive features such as discounts or bonuses upon maturity.
Other Ways to Invest In Gold
Apart from the above-mentioned ways, you can also invest in the following forms of gold and get good returns over time.
Gold Exchange-Traded Funds (ETFs)
Gold Mining Stocks
Gold Futures and Options
Gold Mutual Funds
Gold Accumulation Plans (GAPs)
