As young India becomes more tech-savvy, the demand for long-term profit investments is on the rise. Digital gold is one such investment option that is receiving considerable attention.
For centuries, gold has been a reliable store of value. It is considered secure as an investment and an effective way to beat inflation.
Investing in e-gold is a hassle-free experience
Gold is a widely sought-after investment option due to its stability. However, holding physical gold entails several challenges and potential hazards.
Investing in digital gold, on the other hand, is stress-free and allows you to buy or sell yellow metal without any complications. Plus, with digital gold you have complete control over when and how it’s delivered – meaning that you can take delivery whenever desired!
Purchasing and selling gold in digital form is simple: just visit any platform that facilitates digital gold investments like Jar, Amazon, HDFC Securities or Paytm. Select the ‘Gold locker/vault’ option, enter the amount to be purchased, make payment and your gold will be credited in an insured vault instantly. Your account is updated instantly so you can access it whenever needed.
It is a safe way to invest
Gold is one of the most sought-after commodities when it comes to investing. Not only is it secure and safe, but gold also provides multiple benefits like managing inflation and currency risk as well as being an effective hedge against market volatility.
Investing in digital gold is a secure way to diversify your portfolio without incurring any hidden fees. Furthermore, it protects your investments against theft and mismanagement.
However, there are some disadvantages to investing in gold trading companies. These include the absence of any regulatory authority and unregulated gold trading companies.
As an alternative, investors can consider Sovereign Gold Bonds (SGB) and Gold ETFs, both regulated by SEBI with an attractive 2.5% interest rate.
Investing in digital gold is much simpler and stress-free than physical gold, which requires extensive documentation. Plus, you can start investing as little as Rs1 to get started – making it the ideal option for millennials who want to enter the investment scene without all of the associated complications.
It is a long-term investment
Digital gold is different than gold coins or bars in that you can purchase small amounts over time, allowing for the building of a strong portfolio without worrying about market fluctuations.
Furthermore, selling and reselling your gold investment through instant bank transfers makes it effortless. This will give you access to funds in case of an emergency.
Investors should exercise caution when selecting a digital gold investment option. It is essential to assess if the investment fits within your personal finances and investment goals.
Pankaj Shrestha, Head-Investment Advisory Division at Prabhudas Lilladher Pvt Ltd, recommends investing in fractional digital gold products like SGBs that offer 2.5% above and beyond the current gold market price. Furthermore, any capital gains earned on SGBs are tax exempt.
It is a good way to diversify your portfolio
Though investing can come with risks, portfolio diversification can help mitigate some of them. Portfolio diversification refers to spreading your investments across different assets and industries in order to minimize exposure to certain risks.
Maximizing returns is another advantageous strategy. For instance, if one investment suffers due to an economic crisis, its performance may decline while other assets in your portfolio continue to perform well.
Your portfolio’s assets should be carefully balanced in response to a crisis, as each one responds differently and helps protect each other. For instance, if airline stocks fall, some railroad stocks could potentially offset the loss.
Investing in gold is an excellent way to diversify your portfolio, as it acts as a hedge against inflation and provides a secure store of value. Furthermore, gold investing can increase your savings over time.