Different Ways to Buy and Invest in Gold Trading


Dealing in precious metals like gold and silver has its own history across the globe since ages. There has been an increasing trend in such investments and with advent of online buying and selling options for gold, it has transformed the complete scenario. Prior to this century, only few sections of the society used to make such investments in gold except buying in physical form and that too jewelries. Now technology and internet has made it possible for everyone to get the best knowledge about it and make an apt investment plan accordingly, exactly what you are here to do. In this segment, we will discuss some different ways through which you can easily plan your investments for online gold trading in India.

Physical gold

This is the most common and traditional practice since historic ages where people purchase gold in physical form and most commonly jewelries only. As the time flew, options were available to them to buy gold coins and gold bars which are available in different size. The concept behind buying physical gold is that people consider it as the safest option for their difficult times and as the prices are highly volatile, they sell it and make enough profit out of it. But now, especially from investment point of view, one should only consider buying gold bars and coins as jewelries, due to their manufacturing and designing costs, may not yield best results when you sell them.

Sovereign Gold Bonds

Under a scheme of government of India, SGBs are issued at different times during a year and you can buy these gold bonds from your bank, post office or through agents of Stock Exchange. Investments can be made in denomination of 1 gram and gold bond certificates are allotted to them accordingly. The investors get redemption based on the average closing price of the gold in the past three days. During the term of their bond, they get a fixed interest rate on it.

Exchange Traded Funds

For this you need to create a Demat and trading account as you will be buying units of gold ETFs which are listed on the stock exchange. The ETF gold trade is valued at the current gold price when you buy them. Most of the experienced as well as beginners prefer to invest in gold ETFs as these offer safe and secure returns in a short time. It can act as a hedge against market fluctuations just like an insurance policy covers all related risks to your life, ETFs cover the risk against market fluctuations.

Gold Futures & Options

This can be another good option for online gold trading in India to diversify your investment portfolio as dealing in gold futures also offers protections against inflation. It’s just like a contract where the amount of gold is decided presently for the settlement in a future date. It means depending on your knowledge and trading skills, you can agree for a purchase of gold at current price but the gold will be delivered to you in future at agreed time. Whereas dealing in gold options you buy gold for a certain amount of time. The price at which you buy gold is known as strike price, if the gold price goes up before the expiry of time agreed, you make a profit and vice versa. 

Digital Gold

Another safe option for gold trade. You can buy gold online and can store it in a vault by the seller on behalf of the customer. With the help of mobile and internet banking options, you can easily purchase gold online through some trusted vendor and whenever you feel like the time has come make good returns on it, you can easily sell them in market. There is no such risk involved in this kind of investment as compared to buying physical gold and storing it.