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Prime Reasons To Invest In Gold :

Portfolio Diversification: While constructing a PortFolio it is important to have a range of Asset Classes running alongside to decrease the risk of PortFolio.

Hedge against Inflation: The value of Gold has increased defeating the forces of inflation. The purchasing power of Gold over other Assets has been increasing slowly and steadily but is less volatile.

Hedge against Currency: Gold usually traded in the US Dollars is seen as a safe haven, as opposed to holding the physical currency of any country. As soon as dollar prices decline to major currencies around the world, the Gold Prices see an inherent upward change. There is an inverse relationship between the Dollar and Gold.

Change in Prices: Change in prices is often referred to as volatility gold as an Asset class remains less volatile as opposed to other Asset Classes like Equity, RealEstate, and Debt.

Rising Demand: Central Banks for the reasons stated above have started buying Gold as a part of the Assets they hold. It is therefore by mere market capitalization the prices of Gold recently have sored high. The investment demand also continues to become high due to the increase in monetary base globally.

Safe Haven: It is usually seen that when Equity Markets become risky and unstable the price of Gold increases instantly. This phenomenon can be seen through the yesteryears. Gold, therefore, is considered a safe haven.

FossilFuel like Future: Gold mines for production are becoming limited day by day and there are fewer sites being found for further mining. The stage of mining extension is nearing soon. No credit Risk: Gold continues to be an asset that holds value and unlike Debt, it does not pose a credit risk.

Mode of Investments for Investors :

Commodity Broking: Can be traded in Gold Futures through MCX (Multi Commodity Exchange). Margin-based trading is permitted.

E-Gold: Gold can be bought in Demat Form through NSE ( National Spot Exchange) in denominations as low as one gram. compared to buying Physical Gold it is cheaper and the risk of storing doesn't arise.

Gold ETF's: In Gold Exchange Traded Funds one gram of gold is equivalent to one unit of ETF.and these units are backed by physical gold through stock exchanges. It is an ideal option for Equity Demat Holders with an easy and simple transaction process.

Gold FOF's: In Gold Fund of Funds money can be invested in schemes of Mutual Funds that invest in Gold ETF's. With this option, Systematic Investment Plans are possible which help in averaging gold prices.