By Vipin Agnihotri
Gold has been hitting record highs and at this moment of time is trading at around $874 per ounce. Point to be noted here is that gold has started its long-term bull run and has managed to beat long-term inflation.
Although gold might not give superlative returns over the long term but one thing is for sure, it merits investment attention as a hedge against global risks. In my opinion, around 10 per cent of one’s portfolio should consists of gold in order to hedge against any unwarranted calamity.
There are plenty of factors that make gold look attractive at present. First and foremost, gold is a hedge against the US dollar. In addition, it is closely linked to the depreciating greenback. But there are some experts who believe that gold might not rise too much if the US economy recovers.
Buying gold is quite a straightforward affair. As a matter of fact, investors can choose from three options, namely, Exchange Traded Funds, the commodity exchange, or from your jeweller or banker as imported bars or coin.
Talking about Exchange Traded Funds, they are basically mutual funds traded on the stock exchanges. It is worth mentioning in this regard that investors can buy and sell the units through the exchange. In my opinion, there is a greater safety in holding gold in demat form compared to keeping it physically in a locker.
Lots of banks sell gold coins, but charge a premium over the prevailing price, on the basis of the size of the coins. The sheen is back in gold and therefore a small diversification of your portfolio to include gold can pay off handsomely over the two or three years.
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1 comments:
Investment in gold has always proved a safety net for retail investors. You may like to take a look at our blog, where we discuss certain issues about investing in gold.
Looking forward to your valuable comments. Thanks!
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