Gold Investment
Hedge against inflation and currency depreciation
What is it?
Gold is a traditional store of value that acts as a hedge against inflation and currency risk. In India, it has cultural significance and has delivered ~10-12% CAGR over the long term.
Modern ways to invest: Sovereign Gold Bonds (SGBs), Gold ETFs, Digital Gold.
How does it work?
Sovereign Gold Bonds (Best option):
- Issued by RBI, denominated in grams of gold
- 2.5% annual interest + gold price appreciation
- 8-year tenure, exit option from year 5
- No GST, no making charges, no storage hassle
Gold ETFs: Trade on stock exchange, track gold price, demat required
Digital Gold: Buy from apps (PhonePe, Gpay) — convenient but watch charges
Who should invest?
- Everyone — 5-10% of portfolio as diversification
- Those worried about inflation — Gold tends to rise when everything else falls
- NRIs/rupee hedgers — Gold rises when rupee weakens
Not for: Primary wealth-building. Gold doesn't generate income — it's a hedge, not a growth asset.
Tax treatment
Physical gold & Gold ETFs:
- STCG (≤3 years): At slab rate
- LTCG (>3 years): 20% with indexation
Sovereign Gold Bonds:
- Annual interest: Taxable at slab rate
- Capital gains on maturity (8 years): Fully tax-free
- If sold before maturity: LTCG with indexation after 3 years
SGBs are the most tax-efficient way to hold gold.
How to start?
- SGBs: Buy during RBI issue windows (4-5 times/year) or from secondary market on NSE/BSE
- Gold ETFs: Open demat account, buy through broker (SBI Gold ETF, Nippon Gold ETF)
- Digital Gold: Start with ₹1 on apps (useful for small amounts)
Strategy: Allocate 5-10% of portfolio to SGBs. Buy during dips, hold for 8 years.
Get portfolio advice
Ask Corpus how gold fits into your overall asset allocation and diversification strategy.
Ask Corpus →Disclaimer: This is educational content, not investment advice. Returns and tax rules are indicative and subject to change. Consult a SEBI-registered advisor for personalized guidance.