Where To Invest With Gold
Gold is viewed as a passive investment in countries such as India, which people store for their future or bad times. This can be summarized by explaining that there are many precious metals all around the world but because Indian culture has sentimental value to gold, it may not always be seen as an active financial asset like most places do today.
Mutual funds are up on the charts as one of the most preferred investment options. It is usually advised to invest in mutual funds through SIP (Systematic Investment Plan). An equity mutual fund allows for substantial growth, unlike gold which requires a great deal of knowledge and planning from an investor’s part.
To decide if gold or mutual funds would be more profitable, we must weigh our risks and goals. And the best way to figure out what’s right for you is by carefully weighing your risks and goals with a financial advisor, who can help guide you through the process.
What Returns Have Gold Produced The Last 10 Years?
In his article – Gold, Sovereign Gold Bonds or Mutual Funds: Where should you invest for wealth creation? – Hemant Sood, Managing Director of Findoc Group says that:
Gold has delivered 11.7% annualized CAGR return in the last 12 years and 9.8% in 10 years and is expected to grow much more in the future. On the other hand, since the introduction of SIP’s in India, investing through it has come a long way. The current SIP book accounts for about 1.32 lakh crore and the industry is adding around Rs 5,000 crore per month through SIPs. Witnessing the tremendous growth of the industry, experts expect the Mutual Fund industry to double in the coming two years.
The perks of physical gold make it a potential long-term investment. However, there are risks associated with tangible assets that investors should be aware of including theft and storage problems. On the other hand, mutual funds do not guarantee returns but will involve risk from price fluctuations instead.
For certain, like all types of investment, especially if it is in precious metals, there are both pros and cons, risks and rewards. It doesn’t matter if it is a mutual fund, in a gold IRA, or physical gold you keep in your own storage facility, always way up the options the risks,
(By Hemant Sood, Managing Director, Findoc Group and an Angel Investor in Start-ups)
and the benefits before you invest your hard-earned money.