Gold, Knowledge

Busting Some Myths About Gold Investments

Gold has always been a symbol of wealth and has held a lot of value for people, especially in India. On one hand, some people buy gold as jewelry, on the other hand, some buy it as an investment asset. Speaking of gold investments, you may find plenty of information regarding how-tos and things to keep in mind regarding gold investments. But some of those things are possibly myths. So, here we are busting some most common myths about gold investments. 

You Need a Lot of Money to Buy Gold

Seeing only wealthy people wearing gold can easily make you believe in the myth that you need huge amounts of money to invest in gold. This is completely false. Companies that deal in gold-based investments are taking remarkable steps in making gold investments to a wide range of audiences. There are several companies like OroPocket that lets you start investing in gold with a sum as low as Rs. 1. So, if you don’t have experience or money to invest in gold, you can take your first step by starting small and buying gold for any amount of money that you have. 

Investing in Gold is Very Risky

While a lot of investors can convince you into believing the myth that gold Investments are extremely risky, we want you to know that they are not. In fact, investing in gold provides you a perfect hedge against rising inflation rates, providing investors with a safe investment haven during a crisis. 

Also, gold prices are not as volatile as other investment avenues. If you are looking for a long-term investment option, gold is a perfect choice as the prices of gold are sure to increase in the upcoming times. Therefore, you should definitely consider gold investments occupying a good chunk of your investment portfolio as they can stabilize the effects of changing economic conditions. 

Gold Investments Don’t Yield Any Dividends

We agree that gold investments don’t pay you any dividends. But why do you need dividends when you can earn long-term profits that are much more valuable than dividends? It has been observed that the appreciation in the value of gold happens at a faster rate when compared to the other interest-bearing investment assets. Also, in the case of gold, the investors don’t have to worry about factors that can affect the gains, which are completely beyond the control of investors. 

Gold Investments Are a Bad Choice

Gold investments are one of the most preferred investment options for smart investors. It is because investing in goods insures you against falling equity prices. If the economy is on the verge of collapsing as it is in the current times of pandemic, gold is the best investment that counters the periods of recession. In addition to this, you don’t need to buy a gold investment plan and dedicate a fixed amount of your money towards investing in gold. You can make gold investments in several ways, like buying small pieces of jewelry like studs and nose pins, buying digital gold for as low as Rs. 1, and investing in Gold ETFs. 

You Can Invest in Gold Only by Buying Physical Gold

If we talk about the times before the beginning of the 21st century, when access to the internet wasn’t that widespread and the concept of digital payments was a remote idea, then yes, buying physical gold was the only way to invest in gold. But now the times have drastically changed and you don’t even have to step out of your home to invest in gold. There are three most popular methods of investing in gold which are Sovereign Gold Bonds, Gold ETFs, and digital gold. 

All these gold investments can be done while sitting at home. You can buy Sovereign Gold Bonds by filling out an online application form issued by the Reserve Bank of India. On the other hand, if you wish to invest in Gold ETFs, you need to have a Demat account and trading account. Then you can invest in digital gold by making an account on OroPocket

Investing in Gold Doesn’t Improve Your Portfolio

Many people may make you believe that investing in golf doesn’t improve your investment portfolio. This myth about gold investments may have originated from the fact that gold doesn’t yield any fixed interest rates over time. However, it is not completely true. We agree that gold investors do not earn any interests or dividends, but the fact that the value of gold keeps increasing over time doesn’t support this myth. 

Interestingly, past records suggest that after the end of the gold standard, the prices of gold have increased by an average of 10% against the US Dollar every year. This shows that even though investing in gold doesn’t pay dividends to the investors, it is comparable to high-growth stocks that generate attractive gains but do not give any dividends to the investors. Thus, if you invest in gold, your investment portfolio is forced to improve considerably. 

Gold Investment is Very Difficult

Gold wasn’t an easy investment in the past as there are risks of gold getting stolen from homes. This is true even today. Buying physical gold as an investment is way too risky and you can never ensure 100% safety of your gold. But if you are considering buying gold as an investment, there are various options like digital gold where you can invest in gold and don’t even have to worry about its safety. It is because the companies offering the services of digital gold have extremely secure vaults where they store your gold. So you can sleep peacefully at night, knowing that you have gold to support you in times of crisis and nobody is stealing it from your home. 

End Word

Now that you are aware of these myths about gold investments, we hope that you will no longer believe in them and hold back from making regular investments in gold. If you are still feeling reluctant in going ahead, no worries as you can always start small and watch the progress of your gold investments yourself.