Many people are in dilemma whether he should buy gold or not?Prices are at much higher level,could I get chance to enter at lower levels?In which form should I buy it,whether physical or demat form? I have kept my own opinions here and of course,need not to be true.
1.Cover Timing and price rise Risk:
What is this “Timing Risk”? Everyone needs to buy Gold for some specific occasions or events like marriage etc.Its our tradition to gift child with golden ornaments.What if , you need to buy it for same purpose and gold prices are skyrocketing high. if anyone thinks he will need, suppose 250 grams of gold after 10 yrs then he should start buying gold at this point systematically to cover the risk of price rise in future.
2.Uniqueness:
Gold is a unique metal.We compare it with a stock of share market and I think its wrong.Its completely unique and there is no alternative to it.
3.Universal:
Whether its India or America Gold is same at every place.It do not belong to any person,any body or any country.
4. Any company registered in stock market can deregister from market or it can declare bankruptcy.But there is no stock specific risk for gold.
5.How to buy gold:
50: 50=Physical:online ,looks better combination.Buying online in demat form have unique advantages like safety,higher liquidity since it can be sold easily, etc.
6.Gold have always shown resilience to fall compared to other precious metal partners like silver.
7.Some are of the opinion that systematic investment is not useful in Gold while few are of the opinion that wherever is a volatility SIP is useful.If gold prices deep due to any reason then SIP investor will get benefited more.
8.If compared to longer term like last 25 yrs ,Gold is lagging in its returns.To cover up the due,gold prices should be around $2300 and may reach this mark within few years/months..
9.Now a days there are a number of institutes,banks offer loan against gold jewellery,offering some cash for short term..
Finally,Gold is much more about safety and insurance.Along with if you get some good returns then its like a bonus,isn’t it?
