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Is government gold bond profitable, is it profitable to buy gold..!

Let's see whether it is right for government to buy gold bonds or buy gold, which is more profitable and which investment is safer..

Gold and the Economy,

india economy
Gold is the second most important import of our country (first followed by crude oil). This causes a huge impact on the country's economy. To reduce the purchase of gold, already, p. Chidambaram had said this when he was the Finance Minister

To reduce the import of gold, in 2016, the government introduced sovereign gold bonds. This is almost equivalent to buying gold bars. But here instead of bars, the value of gold is in paper form or demat account. Let us see the difference between direct gold and government gold bonds.

growing rate;

gold; The price is fixed and grows according to market conditions. This includes the dirtiness of the gold, the quality of the gold and some other factors that can reduce the price. It cannot be said that the price of gold will always go up. There is a possibility that money will not grow.

Gold bond; The price is fixed and grows according to market conditions. As it is a gold bond, the price of the day is clearly available. Also, since interest is also paid on gold (around 2.5%), more cash is available. It cannot be said that the price of gold will always go up. There is a possibility that money will not grow.

fluidity;

gold; Can be converted into cash anytime.
Gold bond; Cash is frozen for at least 5 years. Although it is possible to sell in stock markets, the availability of people to buy depends on the market conditions at that time.

security;

gold; To be kept safe. Keep it clean. There is a possibility of theft.

Gold bond; Since it is virtual gold, there is no chance of theft. As there is a government guarantee, the net weight value of gold does not change.

Interest

gold; Gold does not earn interest.For example, Rs. 1,00,000 investment grows at 6% in one year. So, at the end of the year, only 1,06,000. gold foil; Government offers 2.5% or 2.75% interest. This is a great money making opportunity, For example, Rs. 1,00,000 in one year, if it grows at 6%, at the end of the year, adding 2.5% interest, it grows at 8.5%. 1,08,500 grows to
 
risk of losing money;

gold; Can be stolen. If the price of gold falls, there is a risk of losing money.
Gold bond; If the price of gold falls, there is a risk of losing money.
 
line;
gold; There are taxes based on short term, long term and capital gains.
Gold bond; Interest is taxable.If you sell in the stock market before 3 years, you will have to pay short term capital gains tax on your income.

After 5 years and before 8 years, it can be converted into cash once a year. Then, like debt securities, the tax is payable according to the Inflation Index (CII) number.Long term gains are tax exempt when held for 8 years and converted into cash.

the country's economy;

gold; Imports affect the country's economy.Gold bond; Gold is not imported here. Equivalent to gold. But, it will not affect the economy of the country.

Protection of investment;

gold; If gold is lost, the entire investment is lost Gold bond; An investment guaranteed by the government. A safe investment. Earnings may vary depending on the price of gold.

place of purchase;

gold; Can be purchased at any jewelry store.

Gold bond; The Reserve Bank of India has arranged for the purchase of bonds through various channels like banks, post office etc. If the Central Reserve Bank fails to buy it, it can be bought in the secondary market.

to ornament;

gold; You can carry it anytime and turn it into an ornament. Gold bond; It is virtual gold. Not gold. So, convert it into cash and buy gold jewellery accordingly.


For me, if there is no need for jewelry, only for investment, in the long run, it has more opportunities than gold. There are equity mutual funds, bond mutual funds with high liquidity and high growth rates. Therefore, only 5–10% of long-term financial planning can be invested in gold for diversification. Rather than buying gold directly, buying gold through government gold bonds seems to have helped the country's economy and the circulation of investment. Also, interest on government gold, which is not available anywhere else, will help boost investment.
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