The Yellow metal gold is still on its upward trend. It is better to invest in gold for your future financial plans. An investment in Gold gives a definite asset which will not lose. But how? You can invest in physical gold, but security is the main problem to keep this gold. There are some agencies buying gold as per your order and keep it in safe custody for you and sell them when you request them to sell. But you should know that there is some alternate option to invest in gold and can secure it for resale as per your request. The interesting thing is that you can invest gold in SIP (Systematic Investment Plan) by this method. If you do not have enough money to invest in gold in a single lot, don’t worry you can invest in small instalments also. As you heard that little drops of water make the mighty ocean, here you can invest in small but regular lots over a period of time and can earn profit from the increasing value of gold.
You can invest in gold through Gold ETF (Gold Exchange Traded Fund). Buy these ETF in one lot or through Systematic investment plan (SIP). The interesting thing is that you should not keep them in safe custody. You can trade them online through a demat account or through the website of concerned mutual funds. Gold ETF is mutual fund and one can invest in it just like other mutual funds. All leading Mutual Fund Houses issued Gold ETF and all of them offer the same value of liquid gold. You can purchase in small units and can sell them when you wish to do so.
Advantages of SIP in Gold ETF.
Invest in small amounts. By investing in gold through SIP, the investor can invest in small convenient but regular investments. Slowly you can create wealth over a period of time and can use for any of your financial needs. One can sell them easily with the current price of gold.
Disciplined regular saving. The investor can create a regular saving habit through this Systematic Investment Plan. By separating a small amount of money regularly he can create a disciplined investment habit which is beneficial for him.
Get benefit from market fluctuations. Gold is a commodity which has a steady rising tendency in the price. But there may be slight differences due to any reason such as season, political and natural reason etc. But through investing in SIP you can get benefit from such market fluctuations. When the value is less you can buy more quantity and when the value is high you buy less quantity with the fixed instalment amount. When you sell it you will get an average rate of profit.
Other benefits. When investing in gold through SIP one should not look for the timing when the price is up and when it is down in the market. It is planned for buying in a stipulated date every month or whatever may be the frequency. If the price is less in that time you will get gold ETF in less value and vice verse. It is a good system to accumulate wealth without any difficulty. The ETF is more liquid than real gold. Whenever you want to sell it you can sell online. You can assure the value of pure gold when you buy Gold ETF. Whenever you wish to buy more unit, you can do so any time.
All these benefits are there when you invest in gold through Systematic investment plan. So invest in gold through SIP which accumulates wealth for you and also create a good investment habit.
HDFC Gold Fund
SBI Gold Fund
Reliance Gold Saving Fund