Groww Digest

6 Day Course

Theme: different ways of investing in gold

Oct 24 to Oct 30, 2022

6 Day Course is a part of our newsletter

series, Groww Digest - all things personal
finance.

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Day 1: Monday
6 Day Course | Theme: different ways of investing in gold

Gold is a loved investment option among

Indians — and has been for centuries.

Besides Indians, investors all over the world

turn to gold as a hedge against inflation.

Let us explore ways to invest in gold.

The most traditional way to invest in gold is by

buying physical gold.

This can either be in the form of buying gold

coins, biscuits, and bricks. Or, it can be in the
form of jewelry.

From an investment perspective, jewelry isn’t

the best investment method for gold — since
there are making losses and often other
metals are mixed to offer sturdiness.

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Day 2: Tuesday
6 Day Course | Theme: different ways of investing in gold

SGB: Sovereign Gold Bonds.

These bonds are offered by the RBI in India.

SGBs are announced in tranches. The price is

set based on the current gold prices.

In addition to the gold’s value itself, investors

also receive a fixed interest rate on the
amount invested.

On maturity of the bond, the investor gets the

amount based on the gold price at that time.

Investment in SGBs can be done via banks,

post offices, and stocks platforms.

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Day 3: Wednesday
6 Day Course | Theme: different ways of investing in gold

Gold ETFs.

Just like investors can invest in equity or stock

ETFs, investors can invest in gold ETFs too.

Gold ETFs invest in gold bullion and allow

investors to invest in gold digitally.

The gold is stored in paperless or demat form.

ETFs can be purchased using stock investment

platforms.

ETFs are very popular in markets like the US

though they haven’t become as popular in
India yet.

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Day 4: Thursday
6 Day Course | Theme: different ways of investing in gold

Digital gold.

Another option to invest in gold is to invest in

digital gold.

In the case of digital gold, investors are able to

invest any amount in a service run by an
organization that actually stores physical gold.

So, there is real gold being kept safely in a vault

somewhere when you invest in digital gold.

Many services even allow you to receive this gold

in physical form if you choose to.

One of the biggest advantages of digital gold is

that investors can start investing with incredibly
low amounts — even as low as Rs 10.

Some investors have reservations about

investing in digital gold as delivery in physical
form is not offered by all platforms.

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Day 5: Friday
6 Day Course | Theme: different ways of investing in gold

Gold mutual funds.

There are mutual funds that invest in gold and

gold ETFs.

This opens up yet another investment method

to invest in gold digitally.

All other rules applying to mutual funds apply

to gold mutual funds as well.

Do note, returns from gold are taxed

differently in different cases.

Be aware of that while planning your gold

investment.

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Day 6: Sunday
6 Day Course | Theme: different ways of investing in gold

We’ve reached the end of this week’s course that

started on Monday.

Here’s a test you should take. Get pen and

paper!

Question 1:
Which is better to invest in?

-Gold jewellery
-Gold biscuit

Question 2:
Who offers Sovereign Gold Bonds (SGB)?

-SEBI
-RBI
-SBI

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Day 6: Sunday
6 Day Course | Theme: different ways of investing in gold

Question 3:
Gold ETFs can be purchased via:

-Stocks investment platforms

-Post office/government banks
-Both

Question 4:
Digital gold is backed by actual physical gold that
is stored.

-True
-False

Question 5:
Gold mutual funds and ETFs are the same thing.

-True
-False

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Day 6: Sunday
6 Day Course | Theme: different ways of investing in gold

Answers:

Q1: Gold biscuit;

Q2: RBI;
Q3: Stocks investment platforms;
Q4: True;
Q5: False.

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 That’s it for this week!

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See you next week!

—Groww Digest Team

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