Have you ever thought of Gold Investment? Do you feel like a beginner in this area? Are you thinking of investing in gold amidst pandemic? Will the investment bring you any positive returns? This article intends to present you with the answer to how to invest in gold for beginners.
Gold is a commodity which is not just used for jewelry but also investment purpose. This investment is just not restricted to ornaments or jewelry, it has expanded as also Gold ETFs, Gold Mutual Funds, E-Gold, and so on. One can trade gold both physically and digitally. Even when the world economy is facing a crisis due to the COVID-19 pandemic, the gold market has not been stagnant and increasing continuously for the last 15 months. Gold investment can be both long term investment and short term investment.
Looking at the current situation, a short term investment in the gold-market would be beneficial because:
1. A higher Liquidity asset:
Due to the average high volumes of day-to-day gold trade, one can redeem it when required. The gold prices can be accessed 24*7 and can be traded digitally as well.
2. The continuous rise in the gold market:
One can invest in gold to gain when there is an upper movement in cash. There has been a rise in the gold market since 2019. The rate started at USD 1519.50and has crossed USD 2120.70 in a year. So, gold is comparatively a safer investment to make.
3. The yellow metal glimmer usually rises during the festive seasons:
The past trend shows that the prices of gold increase during festivals. It will not be feasible to buy when the price is at a hike, so one can invest now to get benefits in around 6 months.
4. A good hedge against economic shocks:
The relation between gold and stock is inversely proportionate. When there is a downfall in the dollar market, gold becomes less expensive to hold along with the rise in value. Due to this relation, the investor can incur gain from the metal’s increased value.
5. Gold is volatile on a short-term basis:
A notable fluctuation in a volatile market make long-term investors anxious as the rate of return might be average. Gold being one of the volatile markets helps the investors to buy when the prices are low and sell when the prices are at a boom.
The increased cash inflow in Gold EFT’s, increasing risk in the equity market, COVID-19 uncertainty, and the weak US dollar are some of the reasons that might drive the gold prices in the upcoming months. According to experts, the uptrend in gold may continue for the next couple of years. It would be best if one invests in tranches to take benefit of any adverse movement if any in the future.
Benefits of Gold Investment
Before investing in gold, you might want to know what are the advantages of Gold investment.
- It serves as the best constraint against inflation or market volatility.
- Gold is quite an easy and convenient tool for diversifying an investment portfolio.
- Flexible liquidity
- Funding for Gold provides numerous tax benefits.
- Investing in Gold can be started with minimal amounts before funding some huge sum, applicable especially for beginners.