How do you choose between gold ETFs and sovereign gold bonds? MintGenie explains
The latest release of sovereign gold bonds (SGBs) has attracted a surge of eager investors, both online and offline. The continuous growth of gold prices surpassing the current inflation rate has prompted individuals to invest their funds in gold.
The upward trend in gold prices presents an apparent refuge against inflation. Investors are inclined to safeguard their wealth from depreciation caused by inflation and view gold as a reliable hedge. Additionally, the precious metal has a historical track record of maintaining value appreciation over the long term, making it even more appealing to investors seeking both capital appreciation and protection against inflation.
The recent release of gold exchange-traded funds (ETFs) by various mutual fund houses has spurred a considerable number of individuals to choose these investment options. The advantages of investing in these ETFs are distinct and differ from the benefits associated with investing in physical gold.
Affordability and accessibility: In contrast tophysical gold, which demands a substantial initial investment and secure storage, gold ETFs offer much greater accessibility. Investors can participate with smaller amounts, including fractions of a share, making them well-suited for those mindful of their budget.
Liquidity and convenience: Gold ETFs are traded on stock exchanges just like any other security, providing excellent liquidity and ease of purchase and sale. Converting your investment into cash is a straightforward process, eliminating the need to find a buyer for physical gold.
Diversification of investment portfolio: Gold exhibits a minimal correlation with conventional asset classes such as stocks and bonds. Introducing gold ETFs to your portfolio can
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