Buy Gold Coins at 7% discount from
India Post
·
On the auspicious Muhurat of
“Akshaya Tritiya” next week (on May 13, 2013) many of you may be planning
to buy gold. And if you are intending to buy gold coins here’s a chance to
avail of some discount.
India Post at present is offering a 7% discount on purchase of gold coins through post offices on the occasion of Akshaya Tritiya. The offer is available on 24 carat gold coins (with 99.99 purity) which will be available in denominations of 0.5 gram, 1 gram, 5 grams, 8 grams, 10 grams, 20 grams and 50 grams.
While India has an insatiable appetite to own the precious yellow metal - mostly in physical form (jewellery, gold coins or gold bars) for both emotional and financial reasons; it is important to recognise the perils of holding gold in a physical form. The passion to hold gold in a physical form has some disadvantages such as holding cost you pay as a locker rent to stack gold in a bank’s safe vault, quality (unless you are buying 99.99 purity gold), premium you pay (in case you are buying jewellery) and sometimes even resale value if you aren’t holding high purity gold. Moreover, you could be under the scanner of tax authorities since your physical gold holdings may attract wealth tax.
Gold is an effective diversifier and hedge against economic uncertainties and therefore one must own it; but it is vital to invest the smart way in gold. Gold Exchange Traded Funds (ETFs) are a smart way of investing in gold, as they offer the following benefits:
India Post at present is offering a 7% discount on purchase of gold coins through post offices on the occasion of Akshaya Tritiya. The offer is available on 24 carat gold coins (with 99.99 purity) which will be available in denominations of 0.5 gram, 1 gram, 5 grams, 8 grams, 10 grams, 20 grams and 50 grams.
While India has an insatiable appetite to own the precious yellow metal - mostly in physical form (jewellery, gold coins or gold bars) for both emotional and financial reasons; it is important to recognise the perils of holding gold in a physical form. The passion to hold gold in a physical form has some disadvantages such as holding cost you pay as a locker rent to stack gold in a bank’s safe vault, quality (unless you are buying 99.99 purity gold), premium you pay (in case you are buying jewellery) and sometimes even resale value if you aren’t holding high purity gold. Moreover, you could be under the scanner of tax authorities since your physical gold holdings may attract wealth tax.
Gold is an effective diversifier and hedge against economic uncertainties and therefore one must own it; but it is vital to invest the smart way in gold. Gold Exchange Traded Funds (ETFs) are a smart way of investing in gold, as they offer the following benefits:
·
Convenience
·
Quality is uncompromised
·
No question of paying premium for
buying gold, as you do while buying physical gold
·
Low cost (since you don’t pay a
steep locker rent to your bank as you do for holding physical gold)
·
·
Correct resale value (very much
unlike in case of physical gold holding - especially jewellery where making
charges are deducted)
But
you ought to be careful in selecting gold ETFs and prefer those only which
have:
·
Low tracking error (i.e. the gold
ETFs holds more percentage of its assets in gold, rather holding cash); and Low
expense ratio.
Also
those who want to invest in gold at regular intervals in a systematic manner,
can consider gold saving funds (which generally operate like a Fund
of Fund (FoF) scheme which invests their corpus into an underlying GETFs),
since they offerthe SIP mode of investing which provide you with the
benefit of rupee-cost averaging and compounding.
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