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<div type="image" title="Save yourself the trouble of buying physical gold this Diwali, and instead, go digital with Gold ETFs!" height="900" width="1200" msid="114507055" hostid="261" sizebytes="439216" caption="&amp;lt;p&amp;gt;Save yourself the trouble of buying physical gold this Diwali, and instead, go digital with Gold ETFs!&amp;lt;/p&amp;gt;"></div> Ah, <keyword id="18712" type="General" weightage="20" keywordseo="Gold" source="Orion">gold</keyword>! The shiny metal that's been making humans lose their minds since time immemorial. And yet, from <keyword id="23657519" type="General" weightage="20" keywordseo="king-midas" source="keywords">King Midas</keyword> to our neighbourhood aunty and even our moms (and secretly dads), everyone seems to have a super soft spot for the <keyword id="6384667" type="General" weightage="20" keywordseo="Bullion" source="Orion">bullion</keyword>. But here's the kicker: right now, gold prices are breaking all records on their upward trajectory! As of today, prices of 24k carat gold have passed the Rs 80,000 mark per 10 grams. And if experts are to be believed, this train isn't stopping anytime soon! So, as shiny as gold might look, adding even a bit of its glitter as we start decking up for the festive season might not be so easy on your pockets. But let's admit it—we love our gold and can't live without it. No wonder India is the second-largest consumer of the yellow metal in the world, only behind China. Such is our fondness for the metal that the <keyword id="20195223" type="General" weightage="20" keywordseo="world-gold-council" source="keywords">World Gold Council</keyword> had to up our 2024 annual demand forecast to 850 tonnes, up from the previously estimated 750 tonnes. However, our love for gold isn't just about looking fabulously embellished and blinding people with its bling. Indians also see gold as a long-term, trusty investment, supporting our other hard-earned assets, especially when high <keyword id="22195" type="General" weightage="20" keywordseo="Inflation" source="Orion">inflation</keyword> rates pull our returns down. After all, while inflationary pressures generally weaken the purchasing power of our regular paper money, gold is built differently. When the world is buckling to inflation, gold gains value during these times. This is also why it is considered a solid hedge against inflation. With <keyword id="188" type="General" weightage="20" keywordseo="Diwali" source="Orion">Diwali</keyword> and <keyword id="4067" type="General" weightage="20" keywordseo="Dhanteras" source="Orion">Dhanteras</keyword> knocking at our doors, the inflation demon continued to bother India like a guest who refused to leave. Just last month, the Consumer Price Index (CPI) stood at 5.49%, much higher than the anticipated levels. Moreover, the diverging policy stances among central bankers worldwide, growing geopolitical tensions, tough job markets, and extreme weather events are only adding to the uncertainty. In such economically uncertain times, what should your gold strategy be this festive season? To buy or not to buy, that is the question. Well, let’s get to it. <h2><keyword id="20050894" type="General" weightage="100" keywordseo="gold-etfs" source="keywords">Gold ETFs</keyword> to the rescue</h2>See, buying physical gold jewellery is certainly a flex, but also a financial fuss. First, you pay a heavy amount to buy gold. Not to mention all those extra, hefty jewellery-making charges. And then you pay even more money to keep it safe in a bank locker, lest it get stolen. But what if we tell you that you can own pure 24k gold, minus all these frills? Welcome, Gold ETFs (Exchange Traded Funds). Simply put, gold ETFs are like the cool cousins of your traditional gold investments. Instead of stashing gold bars under your mattress like those maniac millionaires we see in Bollywood films, you can now invest and trade in gold through the stock market. It's basically buying units of an <keyword id="19930506" type="General" weightage="20" keywordseo="etf" source="keywords">ETF</keyword> on the stock exchange that directly mirror the ongoing domestic prices of gold. Generally, gold ETFs are equivalent to 99.5% pure physical gold bars, and each ETF unit denotes actual, one gram of gold. And let's face it, who would not want that golden glow in their lives? Gold ETFs have witnessed an over seven-fold surge in their AUM (assets under management) in just the last five years. From Rs 5,613.22 crore in September 2019 to Rs 39,823.50 crore in September 2024, gold ETFs seem to be in-thing. Inflows in gold ETFs have shot up by a whopping 2,695% over the last 5 years. In September 2019, gold ETFs had garnered a mere Rs 44.11 crore. Compare that to the inflows worth Rs 1,232.99 crore gold ETFs received last month. Talk about growing, or glowing popularity! In fact, in just 2024, inflows in gold ETFs have surged by nearly 88% since the beginning of this calendar year. From Rs 657.46 crore in January 2024 to Rs 1,232.99 crore in September 2024, good old gold is never out of season. <h2>So, how do these ETFs work? Should I invest in them now?</h2>All you need is a Demat account. Log into your account, choose the gold ETF scheme you want to invest in, and voila! You’re now a bullion-aire! All your gold ETF units will be stored in this account. Then, you can buy and sell gold ETFs just like you buy shares—in real-time. So, if gold prices inch upwards, which is where gold is currently going, the value of your ETF units will also rise in lockstep. Ashwini Kumar, Senior Vice President and Head of Market Data at ICRA Analytics, says that of late, gold ETFs have been increasingly gaining popularity among investors due to the liquidity, safety and transparency they offer. "With the escalating global geopolitical tensions boosting the ‘safe-haven’ appeal of the bullion, investors are preferring to park their funds in gold ETFs as compared to investing in physical gold, as there is no hassle of storing it. The heightened activity in gold ETFs is also driven by the prospects of an imminent further interest rate cut by the <keyword id="20078761" type="General" weightage="20" keywordseo="u-s-federal-reserve" source="keywords">U.S. Federal Reserve</keyword> in the coming months,” he added. “Investors with a short- to medium-term investment horizon may consider investment through gold ETFs. A buy-on-dips strategy here may help investors capitalise on a temporary correction in prices. Also, given the current market dynamics where equities are showing mixed trends, a modest, 5-10% allocation to gold may serve as a hedge against inflation and market volatility, which may help you balance risks in an optimum manner,” Kumar noted. <h2>Wait, there is no dearth of options</h2>But if ETFs make you go WTF, there’s always digital gold. You can invest in the yellow metal without actually physically holding it for as low as Rs 1. The best part? You can buy or sell this gold 24 X7 seamlessly via multiple apps without having to pay storage costs. On your behalf, your gold is stored in insured vaults by the seller. But remember, digital gold continues to remain unregulated territory in the country, where you venture at your own risk. In 2021, market watchdog SEBI had even asked its members to desist from selling digital gold. Then there are gold mutual funds and the Sarkari SGBs, or sovereign gold bonds. While gold mutual funds invest primarily in gold ETFs, SGBs are issued by the RBI and are also a reliable substitute for holding physical gold. However, with the RBI currently putting brakes on issuing SGBs, investing in them is out of the question. Plus, you should only get your hands on SGBs if you're in for the long haul. Apart from a 2.5% p.a. interest, you don't have any yearly earnings from them. Moreover, no premature redemption is allowed before 5 years, and you'll have to wait a good 8 years to maximise your returns. <h2>Okay, tell me about returns</h2>In contrast, the seventeen gold ETF schemes currently present in the market offer an average one-year return of 29.12%. Stay with it a little longer, and you can end up with returns worth 16.93% and 13.59% over a 3- and 5-year period, respectively. If you look at it, these returns are comparable with the returns delivered by actual, physical gold. Data from Value Research indicates that gold, as a commodity, has delivered returns worth 27.24%, 16.53%, and 14.18% over a 1, 3, and 5-year period, respectively. So, worth investing, right? <h2>What are the risks?</h2>See, markets are as unpredictable as monsoons in Mumbai. One significant market correction can wash away your returns, and one sunny day or an upswing can leave you wallowing in wealth. Since your gold investments are directly linked to these markets, you should steel yourself up for some volatility. Plus, international gold prices are in dollars. So, if our rupee decides to take a nosedive, your returns might look a bit tarnished. Also, know that your ETF might not always perfectly mirror gold prices, which is also known as a tracking error. It's like expecting your Zomato-ordered food to look exactly like the picture on the menu—it's close, but not quite. Then there’s the taxation bit. The budget this year brought down the LTCG (long-term capital gains tax) on gold ETFs from the previous 20% to 12.5% (sans indexation). LTCG is what you pay if you sell your ETF units after 12 months. If you sell your gold ETF units within a year and make handsome returns, the tax you’ll have to pay will be equivalent to your income tax slab rate. <h2>Is gold just for old?</h2>A survey by fintech firm Moneyview thinks otherwise. Per their findings, over 85% of the 3,000 respondents it talked to considered gold to be a valuable asset for wealth preservation, with its intrinsic value and historical performance continuing to drive consumer confidence. Particularly, young investors in the age group of 25–40 years are also investing in gold via both physical and digital ways to build wealth for retirement and other long-term goals. So, young or old, everyone’s going for gold. So, this festive season, with gold prices going north, investing in gold can add that much-needed glitz to your financial attire. But remember, don't go overboard since gold isn't exactly a high-return-yielding asset. But whether you're a seasoned investor looking to diversify or a newbie trying to make their way in the markets, investing in gold offers you a glittering safety cushion. Just remember, while gold can make your portfolio shine, it's your smart investment decisions that truly make you golden. Disclaimer: The content on this website is for informational purposes only and should not be construed as investment advice. We recommend readers consult certified, qualified, and registered advisors for professional and personalised financial advice.

Simply put: Can investing in gold this festive season add the much-touted Midas touch to your investments?

The new series of Sovereign Gold Bonds 2021-22 will be opened May 17-21, 2021, and the issue price during the subscription period shall be ₹4,777 per gram. The settlement date under the Series I scheme had been fixed for May 25. The government, in consultation with the Reserve Bank of India, has decided to allow discount of ₹50 per gram from the issue price to those investors who apply online and the payment is made through digital mode. For such investors, the issue price of the Gold Bond will be ₹4,727 per gram of gold. SEE ALSO: <a href="https://www.businessinsider.in/stock-market/news/go-air-has-filed-for-a-3600-crore-ipo-at-a-very-desperate-time/articleshow/82626097.cms" data-type="tilCustomLink" target="_blank">Go Air has filed for a ₹3,600 crore IPO at a very desperate time</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/markets/news/heres-why-the-spike-in-inflation-in-the-us-may-worry-markets-in-india/articleshow/82597218.cms">Here's why the spike in inflation in the US may worry markets in India ⁠— but experts say don’t panic yet</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/tech/apps/news/whatsapp-responds-to-privacy-criticism-by-alleging-other-apps-like-zomato-ola-aarogya-setu-zoom-google-and-other-apps/articleshow/82570897.cms">WhatsApp responds to privacy criticism by alleging that other apps and tech companies also show disdain for user privacy</a>

There is an online discount on the new Sovereign Gold Bond Scheme opening on Monday priced at ₹4,777 per gram

<ul class="summary-list"><li>European governments are spending trillions to protect their economies against the coronavirus pandemic, but their debt burden is sustainable, according to <keyword id="84979" type="ORGANIZATION" weightage="60" keywordseo="European-Central-Bank">European Central Bank</keyword> chief economist <keyword id="295761" type="PERSON" weightage="60" keywordseo="Philip-Lane">Philip Lane</keyword>. </li><li>"Yes, there will be more <keyword id="141780" type="ORGANIZATION" weightage="60" keywordseo="public-debt">public debt</keyword> at the end of this, but in fact that is the correct response to this type of pandemic emergency," Lane told Portuguese broadcaster RTP3 in an interview on Monday.</li><li>Low interest rates in the <keyword id="6490096" type="UNKNOWN" weightage="60" keywordseo="Eurozone">eurozone</keyword> mean the cost of payments on this debt burden will be contained for years to come, Lane said.</li></ul>European governments are racking up debt in order to shield their economies from the impact of the coronavirus pandemic, but low interest rates mean this burden is sustainable, in stark contrast to conditions a decade ago that triggered the region's borrowing crisis, European Central Bank chief economist Philip Lane said on Monday.Lane told Portuguese broadcaster RTP3 in an interview that while the pandemic was a large shock, it was temporary in nature and fiscal support - in the form of cheap borrowing conditions - was the correct response."Yes, there will be more public debt at the end of this, but in fact that is the correct response to this type of pandemic emergency," Lane said, according to a <a href="https://www.marketscreener.com/news/latest/Philip-R-Lane-Transcript-of-interview-with-Portuguese-public-broadcaster-RTP3--31799054/">transcript</a> of the interview. Coronavirus has killed well over a quarter of a million people across the whole of <keyword id="28249" type="COMPANY" weightage="60" keywordseo="europe">Europe</keyword> and plunged the region into recession. In response, the <keyword id="60971" type="CITY" weightage="60" keywordseo="ECB">ECB</keyword> has kept interest rates at zero in order to keep credit flowing to businesses and households, while national governments are spending trillions in employment support schemes and other benefits to prevent total economic collapse. Read More: <a href="https://www.businessinsider.com/stock-picks-europe-rotation-value-investing-jpmorgan-2020-11">JPMorgan shares 35 European stocks across 10 sectors that you need to own in the rotation to value — including one that could see EPS growth of almost 700% next year</a>Even though public debt across the euro zone will easily reach 100% of gross domestic product, the prospect of a repeat of the <keyword id="113471" type="PERSON" weightage="60" keywordseo="sovereign-debt">sovereign debt</keyword> crisis of 2010-2012 is very remote, Lane said."Across Europe there will be significant increase in public debt, but when you look at the very low interest rates right now, the cost of making the payments on this debt in the years to come will be quite contained. If you look at the market, the market also thinks that this can be handled," Lane said."There is no reason to believe that this has some kind of intrinsic dynamic that will lead us to a return of the conditions of ten years ago," he added.Yields on German 10-year bonds, widely regarded as the safest in the region, are around -0.55%, while those on nations perceived to be riskier, such as Italy or Greece, are trading at between 0.60 and 0.70%. At the height of the crisis in late 2011, the yield on Italian bonds was closer to 7.0% and that on Greek debt hit 38%. "We heard from the ECB Chief Economist Philip Lane overnight as he reaffirmed that the ECB will provide enough monetary stimulus at its next meeting to make sure governments, companies and households have access to cheap credit throughout the coronavirus crisis. He added that, "Our orientation is to keep financing conditions favorable," Deutsche Bank strategist Jim Reid said in a note.The ECB's €1.35 trillion bond-buying programme, together with a number of other policy tools also helps provide a safety net for sovereign issuers.Read More: <a href="https://www.businessinsider.com/stocks-buy-stay-at-home-stock-picks-post-pandemic-barclays-2020-11">Barclays details its ultimate strategy for picking stay-at-home market winners for a post-COVID world — and shares 2 stocks all investors should own before the recovery accelerates</a>

Europe's pandemic debt burden is large but sustainable, the ECB's chief economist says

New Delhi, Jun 22 () State Bank of India (SBI) has mobilised 13,212 kg of household and institutional gold through the Gold Monetisation Scheme (GMS), according to the state-owned bank's annual report. It added that the country's largest lender collected as much as 3,973 kg of gold during 2019-20 under the GMS, a programme launched by the government to utilise gold lying idle with individuals as well as trusts. "During FY2020, (the) bank mobilised gold amounting to 3,973 kgs, bringing the cumulative mobilisation to 13,212 kgs," said SBI in the report. The government launched the GMS in November 2015 to mobilise idle gold held by households and institutions. The objective of the scheme was to facilitate use of idle gold for productive purposes, and also reduce the country's dependence on imports. The bank further said that during 2019-20, it mobilised 647 kg (Rs 243.91 crore) through sovereign gold bonds (SGB), thus taking the total gold mobilised since inception of the scheme to 5,098 kg (Rs 1,561 crore). The SGB scheme was introduced by the government during 2015-16 to promote digital gold instead of physical gold for investment purposes. As a primary player in the field of bullion banking, the bank has been making available metal gold loan to jewellers engaged in manufacturing of gold ornaments for the domestic and export purposes. During 2019-20, the bank extended metal gold loan to jewellers to the extent of 22,255 kg and sold 2,522 kg of gold under the 'Sale of Gold' scheme to jewellers and traders. NKD CS HRS

SBI mobilises 13,212 kg gold through Gold Monetisation Scheme

New Delhi, Jan 16 () Mutual funds industry body Amfi has requested the government to allow low cost debt-linked saving schemes, with tax benefits, to deepen bond market, and lower holding period in gold and commodity ETFs to one year from existing three years for LTCG purposes.
 In its Budget proposals to the Finance Ministry, the industry body has also demanded that the government recognise mutual funds (MFs) as specified long-term assets, qualifying for Long-Term Capital Gains (LTCG), as well as bring ULIPs of life insurance companies and equity MF schemes on par.
 The mutual fund body has also asked for dividend distribution tax (DDT) exemption for EPFO, NPS and insurance companies investing in MF schemes and pass-through status for income tax purpose to those Category III AIFs which make 65 per cent investments in listed equities.
 "Amfi's suggestions have been in the Budget proposal list for a few years. We are hoping this time our long pending submissions get addressed, which would help take the Indian MF industry not only to the next level of growth but also help in contributing to making economy stronger, especially with deepening of bond market, making long term availability of funds for infrastructure growth, and reducing the fiscal deficit by shifting investments from pure gold to gold ETFs," Amfi Chief Executive N S Venkatesh said.
 Some of the proposals are also aimed at bringing parity with comparable investment avenues and making mutual funds more retail investor friendly, he added.
 The Association of Mutual Funds in India (Amfi) said that mutual funds should be allowed to introduce low-cost, lower-risk tax-exemption-linked debt-linked savings schemes (DLSS) on the lines of equity linked saving schemes (ELSS).
 It further proposed that investments up to Rs 1.5 lakh under DLSS be eligible for tax benefit, subject to a lock in period of 5 years.
 At present, equity-linked savings schemes qualify for tax benefits under Section 80 CCC of the Income Tax Act for an investment limit of up to Rs 1.5 lakh in a fiscal year.
 In order to make gold and commodity ETFs more attractive, the industry body has proposed to lower the holding period for LTCG purposes from 3 years to 1 year, as is the case for listed debt securities.
 Besides, Amfi has requested clarity in respect of creation of segregated portfolio in mutual fund schemes, on capital gains tax treatment upon sale of mutual funds units with regard to the treatment of the units allotted consequent on segregation of portfolio.
 In addition, it has proposed that the threshold limit in equity oriented mutual fund schemes be restored to 50 per cent. Reducing the threshold limit of equities from 65 per cent to 50 per cent for being regarded as 'equity-oriented fund' would encourage more investors with lower risk appetite to invest in such funds.
 Amfi has also proposed that the definition of equity oriented funds be revised to include investment in Fund of Funds schemes, which invest predominantly in units of equity oriented mutual fund schemes. SP 
RVK

Amfi pitches for debt-linked saving schemes with tax benefits in Budget proposal

New Delhi, Jul 15 () Public sector banks (PSBs) have purchased bonds and commercial papers worth Rs 14,667 crore issued by 67 NBFCs under the revamped Partial Credit Guarantee Scheme (PCGS), Finance Minister Nirmala Sitharaman said on Wednesday. As part of the nearly Rs 21 lakh crore special economic package amid the COVID-19 crisis, Sitharaman announced Partial Credit Guarantee Scheme (PCGS) 2.0 worth Rs 45,000 crore for non-banking financial companies (NBFCs) and micro finance institutions (MFIs). "As of 10 July 2020, under the extended PCGS, #PSBs have approved for purchase Bonds/Commercial Papers issued by 67 NBFCs amounting to Rs 14,667 crore, of which Rs 6,845 crore is for Bonds/CPs rated below AA, providing liquidity support to NBFCs with lower rated Bonds/CPs," Sitharaman said in a tweet. The purchase of bonds/commercial papers of Rs 6,125 crore, including Rs 5,550 crore of bonds/commercial papers (CP) rated below AA, is currently under various stages of approval/at negotiation stage, she added. "The Partial Credit Guarantee Scheme (PCGS) was revamped under the #AatmanirbharBharat Package to support the liability side of NBFCs by providing a 20% portfolio guarantee to public sector banks for the purchase of Bonds/Commercial Papers rated AA and below issued by NBFCs," she said. Taking the lead, 23 NBFCs from the southern region sold bonds and or CP worth Rs 5,710 crore. It was followed by the western region with 29 NBFCs issuing papers to the tune of Rs 4,540 crore as of July 10. The Union Cabinet on May 20 approved the sovereign portfolio guarantee of up to 20 per cent of the first loss for purchase of Bonds or Commercial Papers with a rating of AA and below including unrated paper with original or initial maturity of up to one year issued by NBFCs/HFCs/MFIs by public sector banks through an extension of PCGS. The Cabinet also extended the time period of the scheme from June 30, 2020, to March 31, 2021, for purchase of pooled assets of the distressed entities. As per the modification, NBFCs/HFCs which have reported under Special Mention Account (SMA-1) category on technical reasons alone during the last one year period prior to August 1, 2018 will be eligible for benefit under the scheme. Earlier NBFCs/HFCs reported as SMA-1 or SMA-2 during the specified period were ineligible. The SMA-1 refers to those accounts where the principal or interest payment remains overdue between 31-60 days, while SMA-2 pertains to those where the overdue period is between 61-90 days. Since NBFCs, HFCs and MFIs play a crucial role in sustaining consumption demand as well as capital formation in the small and medium segment, it is essential that they continue to get funding without disruption, and the extended PCGS is expected to systematically enable the same. DP MR

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Simply put: Can investing in gold this festive season add the much-touted Midas touch to your investments?

Ira Alok Puranik

There is an online discount on the new Sovereign Gold Bond Scheme opening on Monday priced at ₹4,777 per gram

IANS

Europe's pandemic debt burden is large but sustainable, the ECB's chief economist says

Amanda Cooper

SBI mobilises 13,212 kg gold through Gold Monetisation Scheme

PTI

Amfi pitches for debt-linked saving schemes with tax benefits in Budget proposal

PTI

PSBs buy Rs 14,667 cr of bonds, CPs of 67 NBFCs under credit scheme

PTI

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