F.Y.

BCOM (FINANCIAL MARKET) PRESENTS

GOLD Equities Real estate Art and artifacts Commodities Mutual fund Debt instruments

Where to invest Gold Investment

Bars and Gold Coin

Jewelleries

ETFs

Gold has predictable liquidity

Gold has growing demand Gold protects privacy

Gold has low volatility

Gold preserves its value

Gold presents considerable tax advantages

Gold as a heirloom Rare gold coins cannot be confiscated

Gold is apolitical
Gold is safe from repossession

Gold ETFs are open-ended mutual fund schemes that will invest the money collected from investors in standard gold bullion (0.995 purity).

The 35 per cent return that gold has delivered in the last one year and 170 per cent absolute return in the last five years is not par for the course. In the period 1970-1982, gold prices had a compounded annual growth rate (CAGR) of around 21 per cent while inflation grew by 14.1 per cent over the same period. But in the following 23 years, inflation grew by 7.6 per cent while gold prices grew by 7.78 per cent. Over the long term the realistic returns from gold would just beat inflation. Factor in entry loads (a high 2.5 per cent for UTI-Gold) and annual fund management costs of 1 per cent or more, and the returns are not appealing, though the costs are expected to come down in the long run. However, in the short and medium term investment in gold can be very rewarding considering that the prices have come off the highs quite a bit and the indicators all point to a revival in the price rally.