Gold

 Gold Standard

 Throughout the ages, gold has stood the test of time. It acted as a hedge against volatility for some. Governments use gold to ensure that their currency is good.

The price of Gold has increased by approximately 6x (above 600%) in the  (475 USD - 3300 USD ). During the pandemic, gold reached an all-time high of 2100 USD. People said it would stagnate and go down; right now, it rests at 3335, which is another 50 % from where people thought it would crash.

Also, you would have noticed that every time there's high volatility, gold reaches an all-time high (For example, the 2008 Crisis, the 2020 Coronavirus). Gold also spikes in value during Wars or when Commodities are cartelized (mostly oil).

Next, we will see the different ways in which we can invest in gold 

Types of Gold

1) Physical Gold

    The traditional way of investing in gold is by buying jewelry, coins, and bars from shops or banks. Here, you have to pay manufacturing charges, which brings down the yield of the investment. Also, you have to ensure safety either by keeping it in a bank locker or keeping it in a safe.

Pros: You physically own the gold

Cons: Highest Cost of Acquisition, Worst method when the sole intention is investment

2) Digital Gold

   The advantage of buying digital gold is that you are technically buying the purest gold without the making charges, etc. Also, the service providers have to ensure the safety of  Gold.

1) Gold ETF 

      Several exchange-traded funds are available that mirror the benchmark performance of Gold. Essentially, your gold will be like a stock that has ups and downs based on its daily pricing.

Pros: High Liquidity, the Initial Cost of investment is less

Cons: Investors need basic stock market knowledge (transaction & Taxation)

2) Digital Gold 

     You would have seen digital gold sections online OneGold in Paytm, Google Pay, and Amazon Pay. Digital gold is an excellent way to start a savings habit and can even be used by kids, as you can invest as low as 1-5 Indian Rupees.

The three major service providers in this field are Augmont, Safe Gold, and MMTC (Government). Amazon uses Safe Gold while PayTM uses MMTC

Pros: Easiest to Invest, Initial investment is the least amongst all options

Cons: Tax and other expenses are higher when compared to Sovereign Gold Bonds

Gold ETF is the author's choice for Canada, the UK, and the US!

Sovereign Gold Bond is the author's choice for India!

Most of the gold products sold can be traced to either the Bullion Group or the investment management companies like Vanguard & BlackRock.