Have a 10-15 per cent allocation to gold in your portfolio. Since this is an asset class whose value fluctuates quite a lot, build your exposure by investing systematically
Those with long horizon should use sovereign gold bonds; short- to medium-term horizon may consider gold ETFs
Pricing is more transparent and some even pay interest regularly
Gold prices are likely to rise over 12-18 months by 10 per cent. If the recession portended by the inverted yield curve becomes more likely or is seen closer, the rise could be higher and come sooner
The dovish attitude of major central banks could provide a fillip to the yellow metal
Despite gold's tepid returns over the past 6 years, an allocation to it is essential to counter risks like currency depreciation and inflation
Averaging out your purchase cost will be a better strategy than trying to time your entry
The investor gains as he pays no taxes at the point of investment in a forward contract; the bank gets access to cheap funds which it can use to lend onward
A rising dollar is set to limit the return on gold investment in the near term, despite geopolitical tension rising abroad.With the US Federal Reserve expected to raise interest rates again next month, the dollar might continue to fetch better returns than other asset classes, including gold and silver, in the near term. In India, with the southwest monsoon expected to turn weaker than previously estimated for the current season, resulting in a decline in kharif crop output, India's gold demand is likely to remain slow this year.As a consequence, investors are betting for gold as a long-term investment avenue, without looking to make money in the near term. Gold's price was near its recent bottom last week but got momentous support after the US announced its monthly non-farm employment data rise at 157,000 for July, against the expectation of 190,000."Safe-haven demand which generally moves gold prices higher is not clearly visible this time, despite bigger US-China tension and ...
Concentrating in a single asset class can be an invitation to trouble
Sovereign gold bonds (SGBs) are not very liquid
From an advisory perspective, I suggest investors hold gold till December before taking a call on the yellow metal,
It will be a cheaper way to bet on gold price movement as compared to futures