Gold loan market:
Conclusion :
Gold loan market is growing with the highest growth rate and is expected to grow with a CAGR of 38.7% from 2011-2016. The availability of Gold among almost every middle class Indian family has accounted for this growth.
"The Indian population holds world's 11% of the total Gold that value's around Rs. 32,100 Billion was in 2010".
What are gold ETFs?
Gold ETFs are like mutual funds. A mutual fund buys stocks. Instead of stocks, a gold ETF buys gold. Gold ETFs are traded in stock exchanges. Like stocks and mutual funds you can buy gold ETFs in your demat account.
Generally 1 share of gold ETF is roughly equivalent to 1 gram of gold, and hence price of 1 share of gold ETF is also roughly equal to price of 1 gram of gold. You can buy a minimum of 1 unit of gold ETF, which is roughly equivalent to 1 gram of gold.
"Gold ETF is more convenient than Normal Gold".
What are the advantages of investing in gold ETFs over other form of investment in gold?
The main advantage of investing in gold ETFs is that it is hassle free. You can buy and gold ETFs at a click of your mouse from the convenience of your home. If you buy gold coins then you may find it difficult to find a buyer at the time you wish to sell.
Moreover there always remains some doubt about the purity of the gold coin you may have bought and you may have to sell them at a discount. In gold ETFs there are no such hassles. The minimum investment requirement in Gold ETF is also very low.
You can buy only 1 unit of gold ETF which is roughly equivalent to 1 gram of gold. By buying few units of gold ETFs every month, you can slowly build up your gold portfolio. When you sell your gold ETF, you do not get physical delivery of the gold. You get the prevailing market price of the ETF which is roughly equal to the price of 1 gram of gold per unit of ETF. But if you prefer to get physical delivery of gold then you can look for a product E-gold launched by National Spot Exchange.
42% was the one-year (August 2010-August 2011) return delivered by e-gold compared with 40% for gold ETFs. While the marginal difference in returns can be attributed to the cost-effectiveness of e-gold, both these avenues provide ease of investing by allowing people to hold gold in the demat form.
However, each product has its pros and cons - while gold ETF is a more tax-efficient means of investing, e-gold offers the option of physical delivery. This is perhaps the reason experts remain divided on which route makes for better investment, finds out ET. Based on their opinion and depending on your individual needs, find out whether you should go for e-gold or gold ETF.
I do like ETF'S thats for sure.
ReplyDelete