Click to play videoNew Delhi: Uncertainty in the global financial markets has lead investors to rediscover the lustre in gold.
Diwali is barely a week away and Vandana Sharma is on her way to fulfil the family tradition of buying gold during the festive season.
But this year instead of buying jewellery she is buying gold coins.
''Gold is a safe investment, but the shopkeeper here tells me that for every piece of jewellery I buy, I pay making charges. But for a coin or a gold biscuit there are no making charges, so it makes sense for me to buy the latter," says Vandana.
Market analysts say most Indians prefer to buy gold in the form of jewellery. Of the 800 tonnes that India consumes annually, 600 tonnes is made into jewellery. But if you are looking at gold in terms of an investment, jewellery isn't the best way to go.
“People who want to invest very small sums of money and we are talking of a few thousand of rupees, they would typically like to invest in gold ETF. But anybody looking at a slightly larger investment in the range of Rs 1 lakh and above should look at taking gold bars from the commodity exchanges,” says Jayant Manglik, Head Commodities, Religare.
Instead you could invest in gold coins, bars and biscuits. The advantage is negligible making charge and lesser risk of impurity.
If one is adventurous then Gold Exchange Traded Funds allows investment in the gold bullion market without holding the metal physically.
One can also invest through the Multi Commodity Exchange (MCX) and the National Commodity and Derivatives Exchange (NCDEX).
Jewellery, gold coins or bars can earn money through a Gold Deposit Scheme. This needs a minimum deposit of 200 gms, and one can get the gold back in the form of biscuits at the prevailing gold price.
And the best part is that no wealth tax or capital gains tax has to be paid.
All that glitters may not always be gold but if you want the gold to glitter for you, it's probably time to give traditional jewellery a miss and invest more creatively.
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