Diwali-Dhanteras 2024: People buy gold and silver on Dhanteras and Diwali for auspicious reasons. Traditionally, people used to purchase gold in physical form on special occasions like Diwali. However, there are now several other gold options available, which help investors earn profit on gold and save them from the worry of safety and storage. The prices of both gold and silver are hovering near their life-time highs, with the yellow metal in 24-carat purity being sold at Rs 78,610 per 10 grams and silver ruling above the Rs 1 lakh per kg level.
As regards various gold options available for buyers besides the physical metal, they can explore among choices like sovereign gold bond (SGB), digital gold and gold ETF.
Difference between sovereign gold bond Vs. gold ETF
The sovereign gold bond scheme was started in 2015 by the RBI. As the name suggests, SGBs come with a government guarantee. They give guaranteed returns on investment and 2.5% interest annually. Interest is deposited in the bank account of investors every 6 months. The first installment of SGBs came on November 30, 2015 and it matured in November 2023. The 2016-17 series came on 1 August 2016, which will mature in August 2024.
These are the rules: In the Sovereign gold bond scheme, a person can buy a maximum of 4 kg of gold bonds in a financial year. The minimum investment should be 1 gram, while institutions like trusts can buy bonds up to 20 kg. Applications are made in at least 1 gram and its multiples.
Also read: Dhanteras 2024: Buying gold this Diwali? Know tax implications
Gold ETFs (Exchange-Traded Funds) are an investment option that allows investors to buy shares representing a portfolio of gold or gold-related assets, which are traded on the stock market.
Which is better, gold bond or gold ETF?
If you want to invest in gold for a short time, then Gold ETF can be a better option. In this, investors can withdraw money as per their wish and can buy and sell it as per their wish. Gold ETFs have lower purchasing charges than physical gold and are guaranteed to be 100% pure. There is also an option to invest through SIP. Gold ETFs can also be used as security to take loans.
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