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Buying Gold on Dhanteras? Yellow metal has turned Rs 1.5 lakh into Rs 10 lakh in these years

The Financial Express logo The Financial Express 17-10-2019 Rajeev Kumar
© Kunal Patil/Hindustan Times via Getty Images

Not many days are left for Dhanteras (October 25). It is the time of the year when millions of Indians buy gold, either for personal use or for investment purpose. If you are also planning to invest in gold this Dhanteras, the following may excite you.

In the last 16 years, gold price has gone up by over six times. In 2004, the price of gold was around Rs 5850 for 10 gram. This has gone over Rs 39,000 per 10 gram now!

If a person had invested Rs 1.5 lakh in gold in 2004, he would have purchased 256.4 gram of the yellow metal. On today's price, 256.4 gram of gold can fetch him more than Rs 10 lakh.

Last month, gold prices had scaled a record of Rs 40,000 per 10 gram. On Wednesday, gold prices rose by Rs 120 to Rs 39,030 per 10 gram in the national capital region because of festive demand and weaker rupee, HDFC Securities said.

Instead of going for other options, conventional investors are attracted to gold because of concerns over safety, liquidity and returns. The experience of last 16 years shows gold has performed well on all these counts. 

In Pics: This is who owns most of the world's gold

(Slideshow by Lovemoney)

Gold is considered to be an inflation-beating investment as, over a period of time, the price rise of yellow metal has been noted to be in line with the rate of inflation.

Secondly, gold is considered to be a balancing factor in one's investment portfolio consisting of equity investments. Gold has also been found to be performing well when the equity markets fail to perform well. 

How to invest in Gold

You can invest in gold by buying it in the physical form or in the forms of gold ETFs, and gold Funds. You can also deposit your idle gold at home in government's Gold Monetisation Scheme, which is like a fixed deposit for the yellow metal.

Under the scheme one can earn interest on the value of the gold deposited initially and also the principal is adjusted to the market rate through in course of the investment period.

Also watch: IMF expects global slowdown with muted inflation: Gopinath

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(Video provided by Bloomberg)

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