Raise The Bar
Want to invest in gold? It is better to go in for gold bars, rather than jewellery,
WITH the festive season kicking in, gold prices are inching up. Prices recently saw a correction after cooling of oil prices world-wide. Higher oil prices lead to inflation and gold is considered the best hedge against inflation. Not so long ago, gold prices were above Rs 11,000 per 10 gm. But then they plunged below Rs 9,045. If you want to buy gold, besides gold jewellery, you can go in for gold bars as an investment option. Subsequently, these gold bars could be sold to make jewellery.
Many banks such as HDFC Bank and ICICI Bank sell pure gold bars. Some of them give discounts to lure customers. For starters, gold bars come in different weights, ranging from 5-50 gm. Some are imported. While buying gold bars, ensure you get a copy of the assay certification and claim purity as per the highest international standards. These 24-karat, 99.99% pure bars are sold at market rates. Many investors prefer buying gold from banks because they trust the purity certification provided by banks. However, while investing in gold, you should remember that it is better to go in for gold bars, rather than jewellery. Firstly, the purity’s guaranteed with the bar. Secondly, jewellery involves labour charges that are 15-20% of the price of gold. Lastly, when you eventually decide to sell the bar, you get the market value of the gold and you avoid the risk of being cheated. But care should be taken to ensure that finally when you trade in gold, the jeweller doesn’t take you for a ride.
The gold that is bought from banks can be converted into jewellery, and the procedure is fairly simple. Most Indians exit their investment in gold not by selling it, but by converting it to jewellery or gifting it, says a banker. Also, as Indian jewellery is normally made out of 22-karat gold, the 24-karat bar can be easily converted.
Rates of gold have dropped to levels as low as Rs 8,800 per 10 gm recently. Though the rates of gold have plunged in the past few weeks, there is a possibility that they will rise with the festive season. One basically has two ways of investing in gold — firstly, by physically buying gold and secondly, by investing in a gold-traded fund. The latter is yet to see the light of the day in India.
Introducing, SIPs In Gold
WITH rising gold prices, some jewellers are coming up with innovative schemes like systematic investment plans (SIPs), which will make it easier for people to buy gold. Prince Jewellery of Chennai, for example, offers a gold purchase plan. Under this, one can systematically invest in gold every month, by paying an instalment. The instalments are in multiples of Rs 250, from a minimum of Rs 500, lasting from 12-24 months. At the end of every month, your instalment is converted in terms of weight of gold, based on the prevailing gold price. At the end of the scheme, the total weight of gold accumulated is added and can be converted to buy jewellery at the store. While in the past, many SIP investments existed, many allotted gold in grams based on the prices prevailing at the end of the scheme’s tenure. Now, it is actually possible to invest at various price points.
GLITTERATI:
• 24-k, 99.99% pure bars are available at ICICI Bank and HDFC Bank
• Gold bars can be converted into jewellery through a simple procedure
• Gold is considered a hedge against inflation
WITH the festive season kicking in, gold prices are inching up. Prices recently saw a correction after cooling of oil prices world-wide. Higher oil prices lead to inflation and gold is considered the best hedge against inflation. Not so long ago, gold prices were above Rs 11,000 per 10 gm. But then they plunged below Rs 9,045. If you want to buy gold, besides gold jewellery, you can go in for gold bars as an investment option. Subsequently, these gold bars could be sold to make jewellery.
Many banks such as HDFC Bank and ICICI Bank sell pure gold bars. Some of them give discounts to lure customers. For starters, gold bars come in different weights, ranging from 5-50 gm. Some are imported. While buying gold bars, ensure you get a copy of the assay certification and claim purity as per the highest international standards. These 24-karat, 99.99% pure bars are sold at market rates. Many investors prefer buying gold from banks because they trust the purity certification provided by banks. However, while investing in gold, you should remember that it is better to go in for gold bars, rather than jewellery. Firstly, the purity’s guaranteed with the bar. Secondly, jewellery involves labour charges that are 15-20% of the price of gold. Lastly, when you eventually decide to sell the bar, you get the market value of the gold and you avoid the risk of being cheated. But care should be taken to ensure that finally when you trade in gold, the jeweller doesn’t take you for a ride.
The gold that is bought from banks can be converted into jewellery, and the procedure is fairly simple. Most Indians exit their investment in gold not by selling it, but by converting it to jewellery or gifting it, says a banker. Also, as Indian jewellery is normally made out of 22-karat gold, the 24-karat bar can be easily converted.
Rates of gold have dropped to levels as low as Rs 8,800 per 10 gm recently. Though the rates of gold have plunged in the past few weeks, there is a possibility that they will rise with the festive season. One basically has two ways of investing in gold — firstly, by physically buying gold and secondly, by investing in a gold-traded fund. The latter is yet to see the light of the day in India.
Introducing, SIPs In Gold
WITH rising gold prices, some jewellers are coming up with innovative schemes like systematic investment plans (SIPs), which will make it easier for people to buy gold. Prince Jewellery of Chennai, for example, offers a gold purchase plan. Under this, one can systematically invest in gold every month, by paying an instalment. The instalments are in multiples of Rs 250, from a minimum of Rs 500, lasting from 12-24 months. At the end of every month, your instalment is converted in terms of weight of gold, based on the prevailing gold price. At the end of the scheme, the total weight of gold accumulated is added and can be converted to buy jewellery at the store. While in the past, many SIP investments existed, many allotted gold in grams based on the prices prevailing at the end of the scheme’s tenure. Now, it is actually possible to invest at various price points.
GLITTERATI:
• 24-k, 99.99% pure bars are available at ICICI Bank and HDFC Bank
• Gold bars can be converted into jewellery through a simple procedure
• Gold is considered a hedge against inflation
posted by Rushikesh Pandya at
7:54 PM
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