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Investors are tempted to invest in gold these days. Investment in gold ETFs in August increased from Rs 1,558 crore in July to Rs 2,596 crore. Gold ETF has given returns of more than 35% in the last one year.
Jefferies’ Global Equity Strategy Head Chris Wood believes that the price of gold may rise further. In such a situation, if you are planning to invest in gold, then you can invest in it through Gold ETF.
What is Gold ETF?
Exchange traded funds are based on the rising and falling prices of gold. Gold ETFs can be bought and sold on BSE and NSE like shares. However, you do not get gold in this. Whenever you want to exit from it, you will get money equal to the price of gold at that time.
How can one invest in it?
To buy gold ETF you have to open a demat account through your broker. In this, you can buy units of Gold ETF available on NSE and the equivalent amount will be deducted from the bank account linked to your Demat account. Gold ETFs are deposited into your account two days after placing the order in your demat account. Gold ETF is sold through trading account only.
Limited investment in gold is beneficial
According to experts, even if you like to invest in gold, you should still make limited investments in it. Only 10 to 15% of the total portfolio should be invested in gold. Investing in gold can provide stability to your portfolio in times of crisis.
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