SBI Gold Loan interest Rate

SBI Gold Loan interest rate

Taking a loan against gold in India is a wise financial decision than taking a personal loan or credit card loans. This is because the gold loans offer very less interest rates.

SBI Gold Loan is India’s one of the cheapest gold loan in India. Its interest rate is 12-14% per annum.

And you get a loan up to 80% of the market value of the gold. And on the top of this, no income proof is required and even low income group of individuals can also easily get approved for the loan.

Just keep i mind that, here you pledge your gold. So in case, if you default, you will loose the control over your gold. And remember that, Indians have emotional attachment with this traditional asset class and that’s why always take a loan against gold after thinking 100 times.

Here is the procedure to take a gold loan with SBI.

Take Loan Against Gold to Get Richer

Take Loan Against Gold to Get Richer

Gold Loan in India is the new type of loan which is now freely available in many Indian cities. Borrowing money against gold is not the new concept in India. It is the centuries old concept. However, up to now, this segment was highly unorganized. But now the various banks and financial institutes have entered in this sector in the organized form.

As the Gold price is rising day by day, smart investors and entrepreneurs have started taking a loan against their gold to finance their investments, businesses and assets.

Well, yes. It is true. The smart investors are now financing their assets by taking a gold loan. What I personally don’t like about the gold is its non-income producing capacity. Gold is the idle asset class means it doesn’t generate any cashflow/income for you. If you own Rs.1 crore of gold and Rs.1 crore of business than Rs.1 crore of business can give you annual Rs.10-20 lakhs of cashflow but the gold can’t give you any kind of cashflow.

This is the major limitation of gold as an asset class. But well, smart investors are right now taking a loan against their gold to finance their businesses and other cashflow assets. And you can also do the same thing.

The main advantage of taking a loan against gold is that, it has just 11-14% per annum interest rates while if you take a personal loan than you will have to pay 15-30% of annual interest depending on your credit history.

Thus, you can now take a loan against gold in India and use this money to acquire more assets. Well, let me tell you that never take a loan against gold for your personal expenses. You will ultimately loose the control over your gold if you default.

So be a smart investor and finance your assets by taking a gold loan.

Gold Loan Vs Personal Loan

Gold Loan Vs Personal Loan: Which is Better?

Many readers ask me that which loan is better – A Gold loan or a personal loan? Well, it really depends. Most of the personal finance advisors say that gold loan is better than personal loans. Well, I do agree with them but for particular circumstances only.

Let me explain you How?

Most of the finance gurus say that gold loan is better than personal loans for two reasons.

 

01) Gold loans don’t require any Income proof or huge salary. Anyone who has gold can apply for the gold loan. While for taking a personal loan, you will need to submit lots of income proof and other required documents.

02) The second advantage of gold loan is – Low Interest rates. Gold Loan Interest rates are just 12-14% per annum. While personal loan interest rates can be higher than this.

Thus, because of the above two reasons, gurus advise to take a gold loan rather than personal loan.

But well, my opinion is little bit different. What my opinion is that, if you are going to finance the assets (Education, Business, Real Estate or any other Investment) out of your borrowed money than and only go for the gold loan, otherwise go for the personal loans if you are going to finance the liabilities (Tours & Travels, Car, Status items..etc..).

This is because in case of personal loans, if you will default than you will only damage your credit value with the lenders. But if you will default on gold loan than you will lose the control over this precious asset class.

So only go for gold loan if you are going to finance the assets. But if you are going to finance liabilities than go for the personal loans.

Remember, the smart people are those who use debt to finance the assets while the dumb people are those who use debt to finance the liabilities.

Take Loan Against Gold to Finance Assets India

 

Take Loan Against Gold to Finance Assets India

The gold price is ballooning like hell. Recently the gold price has touched the new height of Rs.21,000 per 10 grams. And after the news of Quantitative easing 1 (QE2) by the US Government, it is likely that the gold price will further shoot up.

What I personally don’t like about gold is, its non-productive aspect. The gold is the non-income producing asset class. Means suppose if you have Rs. 1 Crore value of gold in your possession today than your this asset will sit idle in your home or bank lockers and does not produce any Cashflow/Income for you.

While on the other hand, you are working hard to earn that money. While suppose if you own Rs.1 Crore valuation of Business than that business can make you Rs.10-15 lakhs (10-15%) of annual cashflow without you working hard for the money.

So What here I want to say that, don’t work hard for the money but make your money work hard for you. And now, you can do this by taking a loan against gold.

Well, see. Your gold has ballooned in its valuations since 2005. The gold has almost tripled since than. So What the smart investors can do is, they can pledge their gold and take a loan against this gold and start their own business or finance any other assets out of this borrowed money.

Well, I am not saying that it’s risk-free. But well, after all everybody has to take a risk to become successful in the life. The following Indian Banks/Financial Institutions are giving a loan against gold.

1. Allahabad Bank
2. Muthoot Finance
3. Manappuram Finance
4. Federal Bank
5. Central Bank of India
6. HDFC Bank

Here are the Gold Loan Interest Rates India

This is the great chance to finance your new business (or any other asset) by pledging your gold and taking a loan against gold. This is the best chance to use your non-income producing asset (Gold) by borrowing money against it and financing your own cashflow producing asset (Business).

So Don’t miss this chance.

Gold Loan Interest Rates India

Gold Loan Interest Rates Comparison in India

Gold Loan is the new kind of loan available in India. Here just like any other asset, you pledge your gold and the bank will give you a loan against it.

Usually the Banks/Financial Institutes will give you 70-95% loan as that of the value of the gold. Here is the Comparison table of Gold Loan interest rates of various banks and financial institutions of India.

Lender	Interest Rate (%) per Annum	Maximum Loan Amount (Rs.)
Allahabad Bank	12.0	5,00,000
Muthoot Finance	12.0	1,00,00,000
Manappuram Finance	12-24.0	1,00,00,000
Federal Bank	12.75	75,00,000
Central Bank of India	11.5-12.5	10,00,000
HDFC Bank	14.0	10,00,000

 

The above 6 are the Top most lenders of India who give loan against gold. Usually the interest rates vary from 12-14% per annum.

Remember that, there is no prepayment penalty on gold loans. Also remember that, the banks usually lend only against the jewellery.

Gold Demand in India and China Review

[Image Source: Goldworld.com]

Gold Demand in India and China Review

India is the largest consumer of gold in the world. It consumes almost 600-700 tonnes of gold every year. And you won’t believe this but 95% of this gold is in the hands of the Individuals and not the government.

So you can imagine that how rich India is. Recently China also started buying more and more gold. This is because it is loosing faith on the US Dollars and treasury securities. As the US Government is printing money like hell out of thin air only.

According to World Gold Council (WGC), This demand for gold is increasing 12% year on year.

The demand for Gold Exchange traded funds has also rise sharply. People in India, China and all around the world are losing the faith over the dollar. Previously governments from all around the world are used to keep dollar as a reserve currency and preserve the value of their money.

But now they are preferring Gold over the dollar. This is because the gold has direct correlation with the US Monetary base (Money Supply).

In India,

Jewellery buying climbed 8 per cent to 529.8 tonnes in the last quarter, accounting for 57 per cent of total demand. In the second quarter jewellery buying accounted for just 40 per cent of overall consumption.
India bought nearly 50 tonnes, or 36 per cent, more gold jewellery in the third quarter than in the same period of the previous year, bringing its jewellery consumption in the quarter to 184.5 tonnes.

Thus, the demand of gold is rising year after year. Retail Investors of India are preferring gold over any other asset class (Stocks, Bank FDs & Mutual Funds). And in India, since centuries there was a huge demand for gold.

Indians love to buy and own gold in all forms. Gold beats the inflation very well and preserve the purchasing power of your wealth. So invest in Gold. However, I personally advise people to invest not more than 10% of your total portfolio net worth in gold.

[NOTE: I personally don’t invest more than 5% in gold because we don’t have any proper valuation method for this asset class as well as the gold is the non-income producing asset class. So I would rather prefer to own a $ 1 Million Business rather than $ 1 Million value of gold. Because a Business can provide you a cashflow.]

Gold Loan India Review

Gold Loan India Review

Gold Loan means borrowing against Gold. Gold is a precious metal class and up to now, in India the Gold Loan market was highly un-organized. But in the past few years this market started becoming organized after major Indian banks entered into this market.

In Year, 2009 the organized gold loan market was Rs.25,000 crores which is growing at 38% compounded annually and by the end of 2011, this will become Rs.50,000 crore market.

The main advantage of gold loan in India are as follows.

01) Convenience -

The first advantage of taking a loan against gold is the convenience. Here you just have to pledge your gold with the lender (Bank or Private finance institute) and that’s it. You can get a loan up to 80% of its market value immediately.

02) Low Interest Rate -

Another advantage of taking a gold loan is that, it comes with low interest rates. The gold loan interest rates in India are 10-24% annually in comparison to the personal loan interest rates which are 12-26% per annum.

Not only this but with the gold loan, you have an option to pay only interest during the tenure of the entire loan and at the end of tenure, you can pay the entire borrowed amount in a single shot.

This kind of feature is never available in any other kind of loans.

03) No Income/Salary Requirement -

One great advantage of taking a gold loan is that, you don’t need to qualify for any income criteria. This is because here you are pledging a gold, a valuable asset. So you will immediately get a loan from the lender even if you are unemployed and unsalaried.

Which Indian Banks/Institutes offer Gold Loan?

Several Banking and private finance institute offers gold loans at attractive interest rates. Here is a list.

Banks:

01) SBI
02) ICICI
03) HDFC

Private Finance Companies:

01) Muthoot Finance
02) Manappuram Finance

Banks will ask for a ID proof while with the private lenders, you can get a gold loan in just few minutes hassle free.

Dos & Dont’s of Gold Loan

- Go for a gold loan only if you don’t have any other option to raise money. This is because gold has an emotional value and if you default, you will loose control over this precious asset class.

- If you have a bad credit history and low income levels than also you can go for this kind of loan.

- Don’t borrow money against gold for speculative investments like stock market trading or anything else.

The gold loans are now the top choice for raising money in all the classes of people in India. Another fact about gold loan in India is that, people have an emotional attachment with this asset class and that’s why they are less likely to default with this asset class.

One more advise I would like to give readers is that, if possible don’t go for loan against your gold jewellery. This is because in case of your default, the lender will sell that jewellery and this is a psychological disturbing event.

However, also keep in mind that if you don’t have enough confidence to repay that principal amount and the interest payments than simply don’t go for the gold loan. Because you will lose this precious metal.

When to Sell Gold and at How Much Price?

When to Sell Gold and at How Much Price?

The gold price has been skyrocketed since past couple of years and investors are now diverted towards buying a gold. But many investors and the readers of this blog have asked me in the past few weeks that, When to Sell gold and at how much price?

Many readers have also argued that, the gold price will come down from this level of US $ 1400 per ounce (Almost Rs.21,000 per 10 grams).

But well, let me tell you frankly that the gold price won’t come down until the US Government won’t stop printing more dollars out of thin air.

Since 2008, USA has massively expanded its monetary base (Money supply) from just $ 800 Billion to US $ 2 trillion. And in Early November 2010, it has printed more US $ 600 Billion to save its economy.

Thus, in layman’s language, this newly printed money will dilute the purchasing power of the existing money in the circulation causing gold price to shoot up further.

Watchingthegold.org said,

* Unprecedented growth in federal government debt, which adds to the political attractiveness of price inflation. There were federal deficits during the 1970s, but nothing like today’s – just enough to give the party out of power at any time something to talk about.
* The accumulation of U.S. Treasury debt and privately issued dollar debt in the hands of foreign investors. U.S. debt to foreigners wasn’t a factor in the years leading up to gold’s 1980 peak. This time around, it could be a powerful force for accelerating inflation. Even moderate inflation could spook foreign investors. Their sales of Treasuries and other dollar-denominated IOUs would push down the foreign exchange value of the dollar, which would raise the cost of imports coming into the U.S., which would further stimulate price inflation. A nasty feedback.
* And foreign holdings of U.S. debt operate as a second vector feeding the political attractiveness of dollar price inflation. Depreciation of the dollar can be framed as a clever way to shortchange foreign creditors. “It hurts THEM, not US” would be the slogan.

Thus, all of the above factors will drive the gold price still higher.

So When you should sell the gold? What will be the peak price of the Gold? Well, in simple language, you should sell gold when the US Government stops printing more money and start absorbing the excessive liquidity from the economy by increasing its key interest rates (Right now it is just 0.50% per annum means banks can borrow money from the US Government at just 0.50% per annum).

So closely monitor the US Monetary base and the key interest rates. These are the two signs of gold price going down in the future. Till then, buy more and more Gold…!!!

SBI Gold Deposit Scheme (GDS)Review

 

SBI Gold Deposit Scheme (GDS) Review

SBI Gold Deposit Scheme has been launched on 1st March 2010. And up to now, it has attracted more than 4000 kg of gold from the depositors from all around India mainly from Gujarat.

SBI Gold Deposit Scheme (GDS)

According to scheme clients have to deposit minimum 500 gm of gold with a lock in period of 3-5 years. The gold put in by clients is liquefied and converted into pure gold bars. Interest earned on 3 year deposits is 1%, 1.25% for 4 years and 1.5% for 5 years. The gold bars are sold by the bank to the public.

Well, yes. Keep in mind that when you deposit your gold ornaments, coins or jewellery, everything will be melted and converted into pure gold bars. So don’t think that this is a scheme to deposit your jewellery. Only deposit your jewellery if you don’t want it back. Of course, you will get it back but the gold not your original jewellery.

Gold Deposit Scheme (GDS) is in the nature of a fixed deposit in gold. The customers can deposit their idle gold under GDS which will provide them safety, interest earnings, tax benefits and a lot more.

Main features of GDS, in brief, are:

Purpose:

• To mobilize the idle gold in the country and put it into productive use.
• To provide the customers an opportunity to earn interest income on their idle gold holdings.

Eligibility:

Any Resident Indian of the following categories:

(i) Individuals, singly or jointly (as Former or Survivor)

(ii) HUFs

(iii) Trusts

(iv) Companies

Minimum Quantity: 500 Grams

Period of Deposit: 3, 4 or 5 years

Rate of Interest and Payments

• The current interest rates are: 1% p.a. for 3 years, 1.25% for 4 years and 1.50% for 5 years.
• Interest is calculated in Gold currency (XAU) and paid in equivalent rupees.
• Interest rate is subject to change.

Option for Interest Payment: Non-Cumulative (on 31st March) every year or Cumulative (On Maturity)

Acceptance of Gold:

• Gold i.e. Gold bars, Coins, Jewellery etc. will be accepted in scrap form only.
• Customers to submit Application Form, Identification Proof, Address Proof and Inventory Form.

Provisional Receipt issued at the time of acceptance of gold.

Issue of Gold Deposit certificate:

• Gold Deposit Certificate will be issued by Nodal Branch (i.e. Bullion Branch, Mumbai) after the gold is melted, assayed and minted at India Govt. Mint (IGM).
• The certificate will be issued for pure gold contents (i.e. in 999 fineness)
• Multiple certificates (max 5) can be issued

Gold Deposit Certificate (GDCs) will be sent to the depositor within 90 days from the deposit of gold.

Effective Date:

Date of assay certificate of IGM or 30 days of receipt of gold whichever is earlier

Renewal:

Can be renewed any time after maturity provided the renewal is for a future period for the term and interest rate .

Loan Facility:

Rupee loans available at any branch of SBI upto 75% of the notional value of gold.

Tax Benefit:

Exemptions from Income Tax, Wealth Tax and Capital Gains Tax available.

Where You have to Deposit Gold?

You can deposit Gold in 52 selected branches of SBI across the country.

Ahmedabad Circle: Ahmedabad Main, Baroda Main, Rajkot, Surat,

Bangalore Circle Bangalore Main, Belgaum, Mangalore,

Bengal Circle: Burdwan, Kolkata Main, Howrah,

Bhopal Circle: Bhopal Main, Gwalior, Indore Main

Bhubaneswar Circle: Bhubaneswar, Cuttack,

Chandigarh Circle: Amritsar, Chandigarh, Jallandhar, Jammu, Ludhiana,

Chennai Circle: Annasalai, Chennai Main Branch, Coimbatore, Madurai,

New Delhi Circle: Deharadun Main, Agra Main, Jaipur Special,

Meerut Cantt. Chandni Chowk Delhi,PBB-New Delhi,

Hyderabad Circle: Hyderabad, Secunderabad, Tirupati, Vijaywada,

Vishakhapatnam,

Trivandrum Circle: Calicut, Ernakulam, Trichur, Trivandrum,

Lucknow Circle Kanpur Main, Lucknow Main, Moradabad, Varanasi,

Mumbai Circle: Mumbai Main, Nagpur, Panaji, Pune, Shivaji Park,

Bullion Branch Mumbai

Patna Circle: Patna Main, Ranchi.

North East Circle: Guwahati

Documents:

• Identity proof
• Address proof
• Photograph

(Similar to opening of any deposit account)

You are also required to submit :

• Application Form,
• Nomination Form (in case of single individual),
• ECS Form (for credit of interest direct into your account),
• Inventory Form (giving description of gold, No. of pieces and weight of gold after preliminary checking of purity).

What is the Redemption Procedure?

You have to submit the original certificate, duly discharged on the reverse, to reach the Nodal Branch one month before the maturity (15 days if repayment is in cash).

The principal quantity of deposit will be paid in gold or cash, as per the option given in Application Form.

If payable in gold, the fineness will be either 995 or 999 as per Bank’s option. Any fraction quantity (say below 10 gms) will be paid in equivalent rupees.

SBI Gold Coin Rates & Reviews

 

SBI Gold Coin Rates & Review

State Bank of India (SBI) is selling gold coins of various denominations. And you can buy these gold coins from any of your nearest State Bank Branch.

How to track the price of the Gold Coins?

Well, Here is a link to track the real time gold coin rates by SBI. These gold coins are available in 2, 4, 5, 8, 10, 20 and 50 grams of denominations.

Click Here to View the Recent SBI Gold Coin Rates

The main advantage of buying gold coins from SBI is that, there is no issue of any purity. And the State Bank is one of the most reputed bank of India.

Another advantage of buying gold coins/bars rather than gold jewellery is that, gold coins/bars have good resale value as that of current market price in the future.

While if you buy a gold jewellery than it will have a depreciation during the time of selling. So if your only purpose of buying a gold is the investment purpose than go for gold coins/bars.

Gold Coin Purchase with EMI in India

Gold Coin Purchase with EMI in India: Bad Deal

Several jewellers and banks are offering gold coins at 3-6 months of EMI this Diwali to the customers. And many people are proudly buying gold coins and bars on EMI and say that they are investing.

Here are the two online sites. You can check it.

01) Shopping.Indiatimes – Gold Coins on EMI

02) Shopping.Rediff – Gold Coins on EMI

You can see that jewellers are selling gold coins of 5 grams, 10 grams and other denominations at 3-6 months of EMI.

Buying Gold coins/bars/jewellery on loan is a new trend in India. And financially unaware people say that they are investing in gold.

But well, these people don’t know that they are basically violating the basic principle of investing and that is – you should never invest with borrowed money.

Well, Yes. An Individual should never borrow money to invest. Of course, Businesses borrow lots of money and invest it to grow. But well, they are businesses and lots of people are working under that business to generate huge profits and to pay off those debts.

But as an Individual, its the Fool’s plan to borrow money to buy a gold.  So don’t do it to buy a gold. Always buy a gold only if you have surplus money to invest in gold.

How Much To Invest in Gold?

How Much To Invest in Gold?

This is the most common readers’ query about gold investing. In fact, every week, I receive dozens of such kind of queries about gold Investing.

Well, I advise you to read my article,

Why I Personally Don’t Invest more than 5 % in Gold?

In my article, I have explained in a great detail that what is the main drawback of investing in gold and why you should never invest more than 10% of your total portfolio net worth in a gold?

The gold is a valuable asset class but its non-producing non-cashflow/income generating asset class and this makes its REAL valuations very very difficult.

While Businesses (Equity) have cashflow/income and that’s why valuations of the businesses is really predictable and possible.

And that’s why we can never end up overpaying while buying a business/stocks if we know how to do proper valuation of them.

Remember that, Gold does not have any utility and income generating capacity and this makes its valuations very unpredictable.

So never invest more than 10% of your total net worth in gold.

Why I Personally Don’t Invest More than 5% in Gold?

Why I Personally Don’t Invest more than 5% in Gold?

Many people ask me about my view on gold investing and also ask for my opinion about gold investing. Well, I personally never invest more than 5% of my total portfolio net worth in Gold. And I advise people to invest not more than 10% of their total portfolio net worth in a gold.

This is because I have my own philosophy behind gold investing. I have analyzed various asset classes in very detail over the past few years. And Why I am not very much happy with gold is because we don’t have any proper and accurate valuation method of gold.

In Businesses, we have a Cashflow/Income to predict its future valuations as well as the current worth. But Gold doesn’t have any income. The gold is the non-income producing asset class and that’s why its fair valuation is practically impossible.

Traditionally the gold price has direct correlation with the US Monetary Base. Thus, any increase or decrease in the monetary base of USA will have effect on the gold price.

Several theories have been proposed for the valuation of Gold. These theories are based on Inflation, US Monetary base, crude oil prices and various other things.

But all of these are not that much accurate. After all gold is the non-productive asset class. It does not have any income/cashflow generating capacity and that’s why this makes its fair valuation practically impossible.

And this is the reason I personally never invest more than 5% of my Total net worth in Gold and I never advise people to invest more than 10% of their total portfolio net worth in a gold.

Many people argue with me that, since past few years the gold has given outstanding returns than equity so why not take out all of your money from equity and invest in gold? Well, I personally don’t advise anyone to do that.

In my opinion, Equity is still the best asset class to park most of your money for the long time horizon.

Why Gold Price is Rising?

Why Gold Price is Rising?

Recently, many readers have asked me that, if there is a recession in USA and global economic slow down than why the gold price is rising? This is because a logical mind can’t understand this situation. I mean, if there is a recession and global economic slowdown than how come the price of gold is rising day by day?

So I thought that, I should explain this fact to the people who don’t know much about the gold price movements.

Well, See. Traditionally the Gold price is correlated with the US Monetary Base (Money Supply). Money Supply/Monetary Base is the total currency in circulation plus bank reserves.

After 1971, President Nixon of the United States removed the Gold Standard and the US Dollar became free float currency. This means that the US Government can now print any amount of money according to the need of economy.

Thus, the modern money is the Currency (Also known as Fiat Money) without having any intrinsic value in it.

Previously (Before 1971), the US Dollar and all the other currencies of the world were backed by some amount of gold.

[Image Source: DollarDaze.org]

Ok. Now, see the above diagram. It is the diagram of the US Monetary Base means money in circulation plus bank reserves. Since 2008, The US Government has increased its monetary base from US $ 800 Billion to literally over US $ 2 Trillion ($ 2000 Billion).

Thus, the US Government has printed US $ 1.2 Trillion ($ 1200 Billion) out of thin air in the true sense.

So this newly printed money is diluting the purchasing power of the existing money in the circulation and that’s why now there are more dollars in the circulation to chase the same amount of gold and that’s why the price of gold is rising.

Central Banks and Governments from all around the world are playing with money. They have manipulated the money in a bad manner. And by printing more money, they are causing more and more inflation and stealing the wealth of hard working people and savers from all around the world.

Once upon a time, Save money was used to be a Golden financial advise. But today if you follow this advise than you will definitely get poor. Because if you save money today than you are saving something the value of which is going down markedly day by day.

And that’s why the modern financial advise is – Save & Invest your money.

Thus, this is the reason why the price of gold is rising day after day. When I am writing this article, the US Government is planning to print more billions and trillions of dollars out of thin air which will shoot up the gold price further…!!!

SBI Gold ETF Review

SBI Gold ETF Review

SBI is India’s leading nationalized bank and SBI Gold ETF is one best way to invest in Gold. SBI Gold Exchange Traded fund is one of the best way to invest in gold.

1 unit of SBI Gold ETF closely track the price of 1 gram of gold. Minimum investment in this fund is Rs.5000 and there is not any Entry or Exit load in this fund.

Gold ETFs are for those people whose sole purpose of investing in Gold is the investment purpose.

If you want to save a gold for the future purpose say the marriage of your daughter or any other purpose than SBI Gold ETF is the best way to save gold.

After 10-20 years, you can simply redeem your units and buy a physical gold out of your money. In this way, you won’t have any safety or purity issue of gold.

Gold is the precious asset class and since centuries, Indians love to buy gold for various purposed. And in the past few years, Gold has outperformed the Equity and all other asset classes. And that’s why I advise people to invest at least 5% (Maximum 10%) of your total portfolio net worth in Gold.

Also remember that, never invest more than 10% of your total wealth in gold. Gold is definitely a great asset class to invest. And the Gold ETFs are the best way to invest in gold safely and in convenient way.

Quantum Gold ETF Review

Quantum Gold ETF Review

Quantum Gold ETF fund is the unique gold exchange traded fund of India. It differs from other Gold ETFs of India in a manner that, its 1 unit (NAV) closely track the price of 1/2 gram of gold. While all the other gold ETFs closely track the price of 1 gram of gold.

And that’s why the 1 unit NAV price of Quantum Gold ETF is half of that of other Gold ETFs available in the market.

Many readers ask me that why the price of this fund units is half than the others? Well, the above is the answer.

The minimum investment amount is Rs.5000, there is not any entry load and just 0.5% Exit load in this fund.

The main advantage of having 1 unit = 1/2 gram of gold is that, small investors subsequently invest in 1/2 gram of gold also by purchasing small number of units from this fund.

Gold has given outstanding performance since past several years and that’s why I personally advise investors to invest at least 5% (MAXIMUM 10%) of your wealth in Gold ETFs.

Also remember that, you should never invest more than 10% of your total portfolio net worth in Gold. If your sole purpose of buying a gold is the investment purpose than Quantum Gold ETF is the answer for you.

The Gold price will keep going up and up until the US Government won’t stop printing more money (Quantitative Easing in sophisticated words) out of thin air to take USA out of recession.

Anyways…So invest in the gold in a modern way (Demat Gold/Paper Gold) via Quantum Gold ETF.

Kotak Gold ETF Review

Kotak Gold ETF Review

Gold Exchange Traded Funds (ETfs) are the new concept in India. Gold ETFs collect money from literally tens of thousands of investors like you and me and invest in physical gold on behalf of us.

The main advantage of Gold ETF is that, there is not any issue of purity and security and as you don’t possess gold in the physical form, it doesn’t attract any wealth tax.

Kotak Gold ETF is India’s one of the leading Gold ETF Fund. The minimum investment in this fund is Rs.5000 and there is not any Entry or Exit loads.

1 unit of Kotak Gold ETF closely track the price of 1 gram of gold. And the annual fund expenses are maximum 1% which is really cheap.

If your sole purpose of buying a gold is the investment purpose than Kotak Gold ETF is for you. Since past few years, the gold has given excellent returns more than the equity.

And that’s why smart investors are diverted towards Gold ETFs. I also advise investors to invest at least 5% of their total portfolio net worth in gold for better returns.

However, remember that your gold allocation in your portfolio should not be more than 10% of your total portfolio net worth. The gold is a precious metal and its price is directly related to the US Monetary base (Money Supply).

And USA is in recession since 2007 and that’s why it is printing billions and trillions of dollars out of thin air like hell and that’s why it is advisable to invest in gold to maintain the purchasing power of your wealth.

Reliance Gold ETF Review

Reliance Gold ETF Review

Reliance Gold ETF is the Exchange Traded Fund which is listed on BSE and NSE and this fund buys physical gold from your money on behalf of you and keep it in a safe custody.

The 1 unit of this fund closely track the price of 1 gram of gold. And the minimum Investment in this fund is Rs.5000.

Gold ETF is a very new concept in India. Since thousands of years, Indians are investing in a Gold. But till now, there was not any financial product related to gold. But Gold ETFs are the revolutionary change in the gold investing of India.

The main advantage of Reliance GOLD ETF is that, here you can simply buy the units of this fund and your fund manager will invest your money in physical gold on behalf of you and keep it in safe custody. So there is not any issue of purity and security of this precious metal.

Traditionally gold price has direct correlation with the US Monetary Base (Money Supply) and that’s why whenever the US Government prints more money and increase its monetary base, it dilutes the purchasing power of the existing money in the circulation by causing inflation and thus drives the gold price up.

And that’s why since past few years, Gold ETFs have beaten Equity mutual funds also.

Gold ETFs are for those investors whose only purpose to buy a gold is the investment purpose.

However, keep in mind that your overall portfolio allocation should not be more than 10% in gold. Don’t put all of your money in gold but also invest in Equity and Debt.

Gold Benchmark ETF Fund Review

Gold Benchmark ETF Fund Review

Gold Benchmark Exchange Traded Fund is India’s first gold fund which is listed on NSE and BSE. The main advantage of Exchange traded funds is that, they are listed on the stock exchanges so they are more liquid.

Fund Objective:

The fund aims to provide returns that closely correspond to the return provided by the price of gold through investment in physical gold. The reason for performance variance of the scheme from that of domestic price of gold may be due to expense and other related factors.

Thus, the basic purpose of Gold Benchmark ETF is to buy a physical gold from the money of the investors and keep it in the safe custody for the future gains.

1 Unit of this fund closely track the price of 1 gram of gold. and minimum investment is Rs.10,000 in this fund.

See the 5 years Return of this Fund on Valueresearchonline.com

Advantages of Benchmark ETF -

The main advantage of Benchmark ETF is that, here you don’t have to buy any physical gold. So there is not any issue of purity and security of the gold.

Another advantage of this fund is that, as you don’t possess a physical gold with you, it won’t attract any wealth tax.

Which kind of Investors invest in Gold Benchmark ETF?

In India, people buy gold for two basic purposes. One is for jewellery and second is for investment purpose. Now, if your main aim to buy a gold is purely the investment purpose than this fund is for you. This is because if you are going to buy a gold only for investment purpose than it is better to buy it in paper form (Demt Gold) to avoid wealth tax and any issues of securities and purity.

How To Buy Gold in India This Diwali?

How to Buy Gold in India this Diwali?

Diwali is coming and Indians are busy in buying Gold. The Gold price fluctuates record high between Rs.19,500-20,000 per 10 grams. And according to the economic news, the gold price will shoot up more after quantitative easings by the US Government.

Many people want to invest in Gold but don’t know the various options available in India to buy a gold. This article is all about those options. So Here we go.

01) Banks -

The commonest way to buy a gold is from your local near bank branch. ICICI & HDFC Banks provide this service. You can buy a gold in the form of bars and coins of various grams.

The main advantage of buying a gold by this way is that, it comes with tampered proof pack along with 99.99% (24 Carat) purity certificate. Thus, you can buy a gold from banks for purely investment purpose.

However, the only limitation is that, banks won’t buy back this gold from you. You will have to sell it later on in the local market. But well, gold is the liquid asset class so you won’t have any trouble in finding a buyer in India.

02) Tanishq -

Tanishq is the jewellery show rooms chain by TATA Group. You can also visit your nearest Tanishq branch and buy a gold from that branch. Tanishq is the reputed jeweller and that’s why you can buy a gold from it.

03) Jewellers -

Since centuries this was the most preferred way to buy a gold from the jewellers. However, there are many purity issues in buying a gold from the jewellers. However, not the all the jewellers are same. You can buy a gold from the reputed jewellers of your city. The main advantage of buying gold from your local jewellers is that, they will buy back this gold from you in the future at the market prices.

04) Gold ETF -

The only problem with physical gold is – purity issue and security issue. And that’s why the new form of gold has came in India and that is known as Gold ETFs / Demat Gold / Paper Gold / Gold Exchange Traded Funds.

Basically Gold ETFs buy a physical gold on behalf of you and keep it in custody. The Gold ETF is listed on the stock exchanges and it has its units and NAV price. You can buy units of these funds. 1 unit of this fund means 1 gram (or 1/2  gram in some funds) of physical gold.

So the 1 unit of gold ETF will closely track the price of 1 gram of real gold. There is not any issue of purity here. Right now Benchmark, Reliance, Kotak and UTI banks have floated their Gold ETF Schemes.

Thus, the above are the various ways to buy a gold in India.