ETF or SIP’s for investment of Gold

POSTED BY Priti Srinivas ON December 5, 2012 2:00 pm COMMENTS (6)

Hi guys ,

I am planning to get married from 2 to 3 years from now . So would like to have about 20 to 30 gms of Gold?

What are the best options?

I have heard of ETF and SIP’s , which is better and what are the funds to be invested in ?



6 replies on this article “ETF or SIP’s for investment of Gold”

  1. If the gold is going to be worn during marriage in three years time it maybe best to periodically buy the gold in jewel form and put it in a locker.
    Pull out your MF instruments gradually as your marriage approaches.

    If you pay by cheque then you dont have to pay the 1% tax on jewels or you need to shown it in your return and then claim a refund.
    You can time your purchase when there is a steep fall in prices and in the off-season.

    For a three year time period investing and then buying gold will not be as tax efficient. One cannot assume gold etfs for next 3 years will give sames returns as couple of years.

    There would not be a significant difference between periodic purchase and investing and them purchasing. Of course periodic purchase is way more safer against theft,

  2. Priti Srinivas says:

    Also I have already invested in mutual funds and RD, Thus wanted to invest some part of it in Gold too.

  3. Priti Srinivas says:

    The gold will be worn by me during marriage The time period is about 3 years and gold required is 30 gms.

    If I need to start an SIP in Gold. Please suggest which funds must I invest in.

  4. Dominic Prakash says:

    If you have time then go with ETF. I mean you can buy through your Demat account. This is comparatively cheaper.

    Otherwise go with SIP in a Gold ETF Fund.

  5. If the gold is going to be worn by you in your marriage or has to be shown as wealth to your in-laws in the marriage or for your personal future use buy it as jewels.

    if it is meant for financing your marriage then gold like equity is not recommended for such short durations.
    Safer to go for recurring deposits or Fds.

    If you wish you could invest only a small amount of money as ETFs if you have demat acc or start a SIP in a gold fund (there are different expenses involved in each but they will not matter much for 2-3 years)

    Do remember gold prices will not always go up. It can come down quite sharply so dont put all your eggs in one basket if investing for financing your marriage

  6. BanyanFA says:

    Hi Priti,
    This question has been asked in the past as well. Please refer to the link http://localhost/jagoforum2/gold-etf-or-gold-fund/5459/ for the responses.

    Banyan Financial Advisors

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.