Mona Darling “Sona” Kahaan hai !! Akshaya Tritiya 2020 !!

After clocking returns of more than 24% in 2019, this year too gold has continued to shine and has tested record highs of Rs. 47327/10 gms. The above mentioned famous dialogue of a Bollywood movie by the legendary villain of yesterday years Ajit aptly fits to this upside journey of gold prices on Akshaya Tritiya occasion. Simply translated the dialogue means where is the gold !!

According to the Hindu calendar, Akshaya Tritiya marks the day when many Indian households have always considered it auspicious for new ventures, new business and in particular investments in gold.  

So the question is if one should and could investment in Gold?

Will Gold hold its rally and maintain the charm for investors?

Amidst the fears of coronavirus, 80% of the world is under lockdown. With no vaccine yet available to counter this pandemic the global economy are seeing recession fears with severe fall in demands and productions coming to halt.  

Investors have no choice but to Sell of risky assets and shift to safer option of investments in gold. It would not be incorrect to mention here that gold certainly has emerged as Safe haven investment in times of disruption.

"With impending global recession, stimulus packages being generously doled out, uncertainties on oil and other asset classes looming, gold can be a part of portfolio fractionally, around 10 per cent," 

With jewellery shops shut across the country one can look for following avenues to buy gold.

1.      Gold Exchange Traded Funds (ETFs): These are funds which primarily invest in gold and can be bought and sold on the exchange. Gold ETFs are basically, open-ended mutual fund schemes. Gold ETFs over the years have proved to be worthier than physical gold, since gold ETFs not only ensure your investment in the yellow metal but also provide the flexibility, liquidity and tax efficiency that come with stock investments. Transparency in pricing is another advantage.

2.      Digital Gold: Indians now can purchase gold coins, bars and jewellery online. 'Digital Gold', is offered on the mobile wallet platform like Paytm, PhonePe, etc.

Price Outlook

US China Trade war and US Presidential Elections ahead are times of uncertainties and would be only strengthening hold prices in near future.

Depreciation in Indian Rupee has resulted in strong gains for Indian investors.

Long term investors should wait for correction and continue to buy / invest in gold with every dip and should look for price target of Rs. 52000/10gm.