Gold has always been a popular investment in India, but Gold Mutual Funds are emerging as a modern, safe, and convenient way to invest in gold without the need for physical storage or a Demat account. Here’s why investors are increasingly turning to gold Mutual Funds and how you can start investing.
1. What Are gold Mutual Funds?
· Gold Mutual Funds invest primarily in gold ETFs (Exchange Traded Funds) or in companies engaged in gold mining and refining.
· Unlike physical gold, there is no need to store or safeguard the metal.
· Investors can buy units through a mutual fund platform, online apps, or bank portals without a Demat account.
2. Benefits of Investing in gold Mutual Funds
a. Safety and Convenience
· Eliminates risks of theft, loss, or fraud associated with physical gold.
· Can be bought and sold digitally, anytime, anywhere.
b. Low Investment Threshold
· You can start investing with as little as ₹500–₹1,000 per month through a SIP (Systematic Investment Plan).
c. Liquidity
· gold Mutual Fund units can be redeemed easily for cash, similar to other mutual funds.
· Settlement is usually within T+1 or T+2 working days.
d. No Demat Account Needed
· Unlike gold ETFs that require a Demat account, gold Mutual Funds can be purchased directly through fund houses or online investment platforms.
e. Portfolio Diversification
· adds a hedge against inflation and market volatility.
· Helps balance risk in a portfolio heavily invested in equities or fixed income instruments.
f. Tax Benefits
· Long-term capital gains (LTCG) on units held for more than 3 years are taxed at 20% with indexation, which is usually lower than physical gold gains.
3. How to Start Investing in gold Mutual Funds
1. Choose a Fund: Compare top-performing gold Mutual Funds based on returns, fund size, and expense ratio.
2. Register Online: Use a mutual fund platform, app, or bank portal.
3. Complete KYC: Provide identity and address proofs; this is mandatory.
4. Start Investment: Opt for lump-sum investment or SIP as per your financial plan.
5. Monitor Returns: Track performance periodically and adjust investments if necessary.
4. Things to Keep in Mind
· Returns on gold Mutual Funds depend on gold prices in the market, so they may fluctuate.
· Suitable for long-term investment goals (3–5 years) rather than short-term speculation.
· Compare expense ratios and fund performance before investing.
Bottom Line
Gold Mutual Funds are a safe, convenient, and accessible way to invest in gold without the hassles of physical storage or a Demat account. They offer liquidity, diversification, and potential tax advantages, making them attractive for both first-time investors and seasoned portfolio managers.
Start small, invest regularly, and enjoy the benefits of wallet PLATFORM' target='_blank' title='digital-Latest Updates, Photos, Videos are a click away, CLICK NOW'>digital gold investment through gold Mutual Funds.
Disclaimer:
The views and opinions expressed in this article are those of the author and do not necessarily reflect the official policy or position of any agency, organization, employer, or company. All information provided is for general informational purposes only. While every effort has been made to ensure accuracy, we make no representations or warranties of any kind, express or implied, about the completeness, reliability, or suitability of the information contained herein. Readers are advised to verify facts and seek professional advice where necessary. Any reliance placed on such information is strictly at the reader’s own risk..jpg)
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