Advantages of investing in gold

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Advantages of investing in gold
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Gold is not only valued as an ornament but metal
is also a popular form of investment in India.
Most of the families treasure gold for ages
passing it on from one generation to another as a
form of asset. But the physical gold has the risk
of depreciation (due to several charges such as
making-charge, level of gold purity) and of
theft. So, the best way to invest in gold is
through Gold ETFs and Fund of Funds (FoFs). You
dont have to invest a lump sum amount at once,
start with a small amount such as Rs 500 through
regular monthly SIP in Gold FoFs. This will not
look big in a short time but over the years you
will enjoy its growth potential.
Some of the advantages of investing in gold
include Hedge against inflation Gold has shown
positive results even during the economic
downturn and market volatility. It serves as the
best hedge against inflation. Gold has seen
strong asset appreciation in the long-term and
emerged as a must-have in ones investment
portfolio. Portfolio diversification  Gold is
an easy and convenient way to diversify your
investment portfolio.
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Start with a small amount  You can start
investing in gold with a small amount to save
regularly for the long-term. Easy liquidity You
can sell your gold anytime or redeem your gold
fund as and when you need it.
You can avail of Gold Loan on easy terms
and monetize gold on easy terms, without losing
ownership of your asset. Tax Benefits You can
claim long-term capital gains tax benefits on
these funds after a period of one year of
investments.
Is gold a good investment option in the
recession? Typically, yes, gold is known to show
a steady and good performance even during the
recession epochs. Unlike the riskiest asset like
stocks, gold is a tangible asset that people tend
to invest in during hard economic times. In
fact, gold has an impressive history of
stupendous performance during inflation.
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Even when the price falls, does the underlying
value of gold change drastically? Since gold is
known to hold an inherent value across a time
frame, its core value remains less affected even
when the price stoops low. This again makes gold
a beneficial investment alternative.
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How gold is related to equity investments like
stocks and bonds? In common terms, gold is
inversely proportional to shares and allied
equity investments. This means that whenever the
equity market starts performing badly, gold
inevitably performs well. How to invest in
gold? You can start with the conventional way of
purchasing physical gold like coins, bullions,
artifacts, or jewellery. In addition, you can
also choose the newer form of gold investments
like gold ETFs (exchange-traded funds) and gold
funds.
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