2 mins Read | 5 Years Ago

What Is The Best Way To Buy Gold For Investment

What Is The Best Way To Buy Gold For Investment?


There are now many ways to purchase gold in India. If you are buying gold as an investment, some of the best ways to do so are discussed in this post.

Indians love gold not just in jewellery but also as an investment. Gold investments have proven their reliability time and again, making it an excellent solution for diversifying your investment portfolio or creating a hedge against inflation. But with so many ways of purchasing gold, it is not easy for investors to select one that offers the most benefits. Here is a list of some top ways that you can consider if you are buying gold as investment:

1. Physical Gold

The most obvious way to invest in gold is purchasing physical gold. You can either purchase gold jewellery or gold bars and coins as per your requirement. While physical gold has been the go-to investment option, safe-keeping and storage become a major hassle.

Most people prefer storing gold in bank lockers, which require you to pay annual fee. Apart from this, there are also things like making charges and purity of gold that you should be careful about when buying physical gold.

2. Gold ETFs

You can also buy gold online in digital format through Gold Exchange Traded Funds (ETFs). Asset Management Companies (AMCs) offer Gold ETFs, which you can purchase and sell directly from stock exchanges at market prices. However, you will need a Demat and Trading Account for investing in Gold ETFs through exchanges. There will be charges for opening a Trading/Demat Account, and you will also be required to pay brokerage for the purchase.

3. SGB

If you are searching for where to buy gold online, Sovereign Gold Bond (SGB) is also an excellent option. SGB is offered by the RBI, and the purchase window for new investors is opened at regular intervals. Apart from benefitting from the increase in the price of gold if any, you also receive a fixed annual interest when you invest in SGB.

4. Gold Mutual Funds

If you are looking for what gold to buy as an investment, you can also consider investing in Gold Mutual Funds. These are funds of funds which invest your money in Gold ETFs on your behalf. However, you do not need a Trading/Demat Account for selling these funds. You can redeem the units of these funds at the AMC’s website at the current Net Asset Value (NAV) of the fund. If you do have a Trading/Demat Account, most Gold Funds are also available for buying and selling on stock exchanges.

5. Digital Gold

Some of the banks now allow you to purchase gold in digital format. It is similar to purchasing physical gold, but your purchase only remains on paper. With digital gold, you can invest as little as Re 1, making it an excellent choice for people searching for what is the best way to buy gold with a minimum investment amount. Digital Gold eliminates the need for you to worry about purity, making charges, storage or safe-keeping. You can redeem your purchase anytime you like and convert your paper format gold into physical gold like gold bars and coins or gold jewellery and get it delivered to you.

Which Option Should You Select?

As compared to all the other options, the best gold to buy for investment is Digital Gold as it proves to be the most convenient and cost-efficient. It does not require you to worry about the safe-keeping and storage of physical gold nor open a Trading/Demat Account like ETFs.

Understand all the discussed options in detail and prefer investing a small amount at first to understand how a gold investment option works thoroughly.

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