Investment in gold: how is it beneficial?

Investment in gold has always been a liking of gold investor. But there are certain expertise secret tips which must be known before gold investment. Guide of how to invest in gold and types of gold investment is here for our readers.

Gold has always been a liking of every human being. You may also want to know that should I invest in gold? Gold has been emerged as a source of alternative investment due to high prices. Thus the future in gold investment is now very brighten as compared to investment in funds, etc. Let's read further about investment in gold.

Guide to invest in gold

Gold investment is believed to be most secure and safest mode of investment. Instability and low interest rate of shares makes them less profitable than gold as gold rates keep on rising due to inflation.

You can also take gold loan in times of need or can convert it into gold bonds. Thus gold investors like to invest in gold due to its positive features.

You can also purchase gold bars or gold coins if not interested in purchasing gold ornaments as the making charges on bars and coins are negligible.

How to invest in gold

Investment in gold can be made either in long term or in short term. People who are willing for short term benefit can purchase gold can sell it after 4-6 months when its price rises. On the other hand, long term investment in gold serves as insurance.

Types of gold investment

Investment in gold can be made in any of the following three types:
  1. Gold ornaments
  2. Gold ETF (Exchange Traded Fund)
  3. Forward trading in commodity exchange

Gold ETFs are mutual funds which invest in gold and the valuation of funds is done on the basis of gold price. You can buy jewellery if you want to invest small amount but it is advisable to invest in ETF if you have to invest bigger amount.

Tips for gold investment

1. If you want to invest in gold for investment purpose only, then it is advisable to purchase gold in liquidity form. In other words, purchase gold in the form in which it can be easily converted into money. Gold ETF is best suitable in such case. These can be easily sold whenever required.

2. Don't purchase big quantity of gold at a single time. Only 1% of your portfolio should be of gold investment.

3. Make of limit of your loss bearing capacity. The downfall in any commodity comes at the unexpected time. Same is in case of gold. Thus it is beneficial to sell your gold if the prices of gold are falling down.

4. If you are purchasing gold in physical form instead of paper form, then consider the Hallmark gold only. Hallmark gold is 5 digits government guaranteed gold.

5. 22 carat gold is best which has 91.66% pure gold. No deduction charges are deducted on such gold at the time of sale.

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