Dear curious4ever, First of all plz. understand that the underlying assets in Gold ETFs & Gold funds r totally different.
In case of Gold ETFs, the physical gold is the underlying asset whereas in case of Gold funds, the underlying assets r the shares of the gold mining cos. worldwide.
As u already know the price of a stock may fluctuate very often due to several reasons, it`s advisable to invest in Gold ETFs as per ur own comfort.
In case of Gold ETFs, for u my choice `ll be Quantam Gold ETF, as it`s unit size is 0.5 gm gold, while all other Gold ETFs` 1 UNIT represent 1 gm. Gold. So for ur mly. budget of 1K to 2K, i think u can better plan with Quantam Gold ETF due to smaller price of Unit.
Dear curious4ever, The problem with Gold ETFs u can`t invest thru SIP or STP.
U can only purchase from exchange thru ur demat acct.
From Taxation point of view, both gold ETFs as well as Gold Funds r treated as debt funds. So no change.
On expense side, as of now Gold ETFs r a bit costlier as all ETFs have common exp. ratio of 1% where as for AIG Gold fund it`s .75% & for DSP Gold fund it`s 0.57%.
I meant to say, self systematic investment in Gold ETF, by buying say 1 unit on a fixed date of each month.
I do have Demat Account.
So what should I do?
What`s your projection, as to which one will do better in long term (since my elder daughter is 10 year old, and I have at-least 8 more years for her marriage)?
Dear Friend, I don`t know that for ur D`ter aged 10 at present, u r going to marry her at her age of 18 for sure or not.
As u posted that u `ll marry her after 8 years. My simple solution - Imagine u r going to marry her 2day, then how much gold u `ll gift her?
I assume ur answer `ll be 200 gm.
Now 8Y = 8*12 = 96 months
It means u w`d have to purchase at least 2 Units every month. As i mentioned earlier, u can`t SIP in Gold ETFs for ur requirement u w`d have to purchase thru ur demat acct. mly.
Dear curious4ever, As per the latest info posted by u for the marriage age of ur D`ter, u can accordingly define ur own mly. or qtly. contribution in terms of quantity of gold.
My wife started investing in gold when my daughter was born. I could only buy 1 gm per month. We started with 1 gm per month of the gold wire rings every goldsmith sells as pure gold. As our buying power increased, we kept on buying more every month. Now for last few years we have found that there is a sort of Bhishi, where you give 11 cheques,one per month & the goldsmith will put the 12th installment. You buy gold at market rate from the shop. This gives about 8% rturn, higger than your FD`s and allows me to buy gold biscuit. I suggest you buy real gold instead of ETF`s & Gold funds. I prefer buying gold in 50 gm or higher size biscuits. These are guaranteed pure form and can be sold or used for ornaments later.
You can look at gold as a parallel investment, just like bonds or stocks. Steady and sure returns.
Regards
But, buying 1 gram pure gold is possible?
Though there are 1 gram stuff available, but then what about purity and making charges?
Then, if you want to use them for remaking other ornaments, again you loose money. Am I right?
| NIFTY 
