Gold has always been treasured as a valuable commodity from barter trade to jewellery investment and now paper gold. Gold has been a safe-haven investment option as well as a good diversifier. So gold can hold up the portfolio’s overall returns even if one or more of the other asset classes are not performing well. Gold as an asset class can deliver optimum returns in the long term, say 5 years or more.
Investment in gold are available through the paper form and investors can invest through systematic investment plans (SIPs). This paves way for disciplined method of investment and not invest in gold during festive periods, or when you have some extra cash. Investing in gold through SIP has its own advantages such as investing at regular intervals and averaging out the cost per unit. Also, one can invest small amounts regularly
You can invest in paper gold through gold exchange traded funds (GETFs) and/or gold fund of funds (GFoFs). GETFs are open-ended mutual fund schemes which invest in standard gold bullion. There is no risk of holding physical gold and are easily affordable. GFoFs are open ended fund of fund schemes for people who do not have a Demat account. GFoFs are more liquid than GETFs and are available as SIP.