Gold prices have shown a sharp decline of Rs 2,000 compared to 10 gm last week. According to specialists, this decline results from an upward thrust in the US interest rate, tighter financial coverage, and strengthening of the US dollar.
Many people should consider investing in yellow metal amid this dramatic cost dip. However, it is essential to understand the investment strategy before pursuing it.
So, how should one put money into gold now?
According to Adhil Shetty, CEO of BankBazaar, the current fall in gold prices is temporary, and you can still count on a direction correction within the coming weeks. However, Shetty points out that there is a fair amount of volatility inside the market, and investing in gold for speculating might not be a smart idea.
“It must most effectively be done for a long time,” he stresses.
Ketan Kothari, Director of Augmont, seconds Shetty’s views and adds that individuals need to use this fee dip to start accumulating gold in the range of Rs 46,000/10 gm to Rs 47,000/ 10 gm.
Also, examine the following three monetary errors to avoid crises like COVID-19. In the future, Kothari believes that costs could rise to Rs 50,000/10 once more within three to four months because of excessive inflation in the US and festive demand from India.
How much gold do you need to buy?
Talking about asset allocation, Shetty of BankBazaar says that gold should be a small part of one’s portfolio and not exceed five to ten percent of the total investments.
Where should one make investments?
While gold has traditionally been exchanged or bought in physical form, and it still is, there are troubles associated with handling physical gold, such as storage issues, chances of robbery, purity concerns, etc. Given these issues, one should invest in gold ETFs, virtual gold, or sovereign gold bonds instead.
“Gold ETFs are clean to trade on exchanges and are available in dematerialized shape. Sovereign gold bonds, which can be issued by using RBI, accompany an assured interest of two five percent in line with annum at the same time as gold deposit schemes can be considered as a hard and fast deposit in gold,” says Harsh Jain, Co-founder, and COO, Groww.
