Definition of GOLD AS AN INVESTMENT
People invest in different commodities to reserve their cash and / or gain profit in future. One such the most precious and popular metal investment is gold. Gold has been used as money in history and is equivalent to money even today.
Apart from investment and profit perspective buying gold for use is also an asset. An average person can buy it (in form of jewelry, gold coins or bars), use it and then can sell it without any deterioration in its price and condition. This is because it is very liquid and there is less price fluctuation.
Brief Explanation of GOLD AS AN INVESTMENT
(Referring to investment in gold here means buying physical gold and not buying shares in gold mining companies).
But just like any other investment gold market also fluctuates but still is the safest metal investment.
Advantages of Investing in Physical Gold:
- A lay man can make and earn profit with such an investment. All you need to do is just purchase it and keep it safe in your procession until the market rate increases to your purchasing cost and you want to realize profit by selling it.
- No broker or agent fee involved.
- No fuss of keeping yourself updated with the prevailing share market.
- Highly liquid investment.
- No need to wait for one whole year to earn profit as in dividend case. (If you get lucky price might increase just a day after you purchased it and you can sell it in profit)
- It’s demand never goes down.
- Direct ownership
- International recognized commodity and hence can be dealt with globally.
- Good for long as well as short term investment
Dis Advantages of Investing in Physical Gold:
- Theft risk if kept at home.
- Storage charges if kept at bank locker
- No monthly or annual profit yield. (Profit can be earned on sale only)