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Investing in gold is risk free this Dhanteras!

Gold sovereign bonds, digital gold, gold ETF and gold funds are some of the better ways to invest in gold.

As Indians, we are very fond of gold. Our love for gold is evident from the fact that India is the largest importer of gold. The demand for gold significantly goes up during the festivals as it is believed to be auspicious. Many people also buy gold on Dhanteras, first day that marks the festival of Diwali in India . Dhanteras, is one such auspicious day when people buy gold. The gold price has also declined in the past few months. You may be looking to buy gold but before you buy gold, you can look at other investment options that are backed by gold.

Here are some of the investment options that are better options than buying physical gold.

Gold sovereign bonds:

Gold sovereign bond is the best way to invest in gold in a non-physical way. The Reserve Bank of India issues sovereign bonds from time to time. It pays an interest of 2.5% per annum. Currently, there are no issue of Sovereign Gold Bond (SGB). However, you can buy earlier bonds from the stock exchanges at discount due to the lack of liquidity. You can apply for gold sovereign bonds online through your bank’s website. You can look at these bonds if you want to hold it till maturity. You can need a demat account or you need to do KYC to invest in gold sovereign bonds. The returns given by these bonds are higher than physical gold as it does not have making charges. Sovereign gold bond is also immune to the wear and tear of physical gold. Plus there is no risk of theft.

Digital gold:

Digital gold is a simple and safe way to invest in 24K physical gold online. The digital gold is backed by physical gold which can be sold online at market rate. You can start investing with little amount of money in digital gold unlike in physical gold where you have to buy at least a gram. Digital gold is extremely liquid as you sell your gold online through a few clicks. You can buy digital gold through Paytm, Mobikwik and PhonePe and under the Gold Rush Plan of Stock Holding Corporation of India. The gold purchased is kept in a vault. Digital gold is also safer than physical gold.

Gold ETF:

Gold ETF is another way to invest in gold. Gold ETFs is listed on the exchange and gold bullion is its underlying asset. One unit of gold ETF is equal to one gram of physical gold. As gold ETFs are backed by pure gold, you don’t have to worry about its purity. Also, one needs a demat account to invest in gold ETF. Gold ETFs also does not come with making charges and is safe from theft. However, liquidity can be an issue with gold ETF.

Gold mutual fund:

Gold mutual funds do not invest in physical gold but Gold ETFs. Also, you don’t need demat account to invest in gold mutual funds. You can also invest a small amount of money every month through systematic investment plan. Gold funds also have higher management fees than gold ETFs and you need to invest a minimum investment of Rs.1,000.


These were the four new ways of investing in gold. These investment options does not have making charges, it is safe from theft and higher returns and require less investment amount than physical gold. So this Gudi Padwa, instead of buying a gold ring or other gold ornaments, you can invest in any of the above mentioned investment options and get greater benefits.

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