As festival season is around the corner, people may be looking to buy gold, which is considered auspicious in Indian tradition. Most often, individuals buy jewellery on such occasions, or in case if the purchase, is for investment purposes, then a gold coin or bar tends to be the preferred option.

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While the purchase is any, Anurag Jhanwar, Co-founder and Partner, Fintrust Advisors LLP advises people to first value all forms of their gold holdings, so that they do not go overboard with one asset class.

“10 percent to 15 percent of total net worth is ideal allocation,” he suggests.

For people buying physical gold, Vaibhav Saraf, Director of Aisshpra Gems and Jewels says it is always better to buy hallmarked and BIS certified jewellery which indicates the purity of gold.

“While designs and trends can change, the value of gold jewellery remains the same,” he opines.

He further advises consumers to surely ask for a billing invoice (while buying gold) which includes important details of the transaction.

“This will offer transparency on all charges,” he says.

Additionally, Ishu Datwani, Founder, ANMOL suggests consumers to go for classic and timeless jewellery and exclusive designs

“Always buy from a reputed jeweller who gives buy-back guarantee,” he adds.

On the other hand, those looking to invest in paper gold can go for this season for safety and liquidity.

“One of the primary advantages is that ETFs are held in demat form, and one needn’t worry about the safety aspect. Also, the cost of acquisition is very low, given the absence of making charges and other related expenses. One can even consider doing a SIP for as low as Rs 1,000 every month to collect gold units over a period of time, to meet any future requirement,” says Chintan Haria, Head- Product Development & Strategy, ICICI Prudential AMC Ltd.

In case one does not possess a demat account, Jhanwar advises to invest in a gold mutual fund that tracks gold ETF.

Another alternative is Sovereign Gold Bond (SGB), which though illiquid pays an additional annual interest of 2.5 percent on the total invested capital.

Disclaimer:

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