Sunday, 12 May 2013

Akshaya tritiya 2013 -- Buy Gold ETF...

It is a practice prevalent among Hindus to buy gold ornaments or gold coins on the day of Akshaya tritiya.  However among financial advisers and planners, there are advocates for and against investment in gold. 
  • Gold can hedge in case of currency of a country becoming weak and there is inflationary pressures in the country
  • International Gold price has given good returns during last several years but there is a market price correction giving opportunity for those who have missed out in the last rally.

Those who are against argue
  • The period of depression in US economy and inflation is over and Gold price may not rise in the immediate future.
  • The correction in the market price for Gold is not yet over.
  • RBI and Government discourages holding or hoarding gold as investment vehicle nowadays.  
  • Real estate will soar again, therefore that is the best bet.
 To overcome these, pundits suggest that it is better to invest an SIP of Gold ETF (Exchange Traded Fund) so that it can over a period of time, average out the cost price in the down trending market. 

It is advisable to buy GOLD ETF units instead of gold coins or jewelry  so that in the worst case scenario, we can sell out the units without much loss because of  making charge, wear and tear depreciation  etc.

You may refer previous blog on GOLD ETF investment as a part of your financial and retirement planning.