154189 SIP myths you must know!

“If you don’t trust gold, do you trust the logic of taking a beautiful pine tree, worth about $4,000 – $5,000, cutting it up, turning it into pulp and then paper, putting some ink on it, and then calling it one billion dollars?” — Kenneth J Gerbino

The love for gold has been since ages and trusts me it has not faded a bit till date. It is an asset class which is a must for any given asset allocation strategy. Gold is ‘King of both Good Times and Bad Times’. It is a hedge against inflation and currency risk.

Gold is one of the most coveted metals in the world; it has been used as a medium of exchange longer than any currency in history.

So, how does one invest in this yellow metal?

There are four modes of investing — Physical gold, digital gold, gold ETFs and gold saving funds and sovereign gold bonds.

Physical gold is the most preferred route of investing. It can be bought from the nearby jeweller shop, bank or institution. Gold can be bought in form of coins, ornaments or bar. It is a gift for all season & reason. Its sheer touch and feel act as a fantastic balm that can make her calm. I guess all the readers who are married would be able to resonate with me on a lighter note.

Two tempting scenarios for buying physical gold

Firstly, according to Indian tradition, it is considered auspicious to buy gold on Dhanteras, Akshaya Tritiya and other important days. The sheer pleasure of owning physical gold can’t be replaced by paper bond; is the view that we get from many. Buying physical gold in small quantity is ok, you can always gift to your near and dear ones.

Secondly, if you need gold rings, pendants and bracelets for regular use or may be few ornaments to wear during marriages, functions, social gatherings.

(The writer is a certified financial planner. Views expressed are personal)