GO FOR GOLD

With the price of 10 grams of 24-carat gold hovering in the Rs 1.2 lakh range, there is renewed interest among investors to include the yellow metal in their portfolios

- Narayan Krishnamurthy

Gold has always held prime importance in an Indian household, whether in the form of jewellery or as a symbol of wealth, prosperity and divine blessing. Festivals and events such as Diwali, Akshay Tritiya and weddings all have a symbiotic connection with the yellow metal. It hardly comes as a surprise, then, that according to the World Gold Council report, India is the second-largest consumer of gold globally.

So, when the price of the yellow metal shows a rapid escalation-as has happened in recent years-and many central banks have begun to raise their gold reserves, it is natural for people to ask if it makes sense to buy it at these prices. The decision to add gold to your existing investments should not be based solely on the rise in gold prices but rather on clearly assessing how much gold you should have in your portfolio and how it aligns with your existing financial plans.

The economic value of gold has been clear since time immemorial. Scarcity and longevity are factors that attract people to gold as a safe asset or investment, especially in uncertain times. It is widely seen as a hedge against inflation and a safe bet during bear markets, wars and recessions. When viewed over a very long period, gold has not only retained its value, but also outperformed inflation significantly. However, many households may not factor in the gold they possess in physical form as part of their investment portfolio.

BUYING GOLD