CS & Legal
368 Points
Joined January 2009
Gold is Safe haven investment in the World and India has a consumption story of Gold.
Rather than investing in gold fund you can invest in E-Gold on the platform of National Spot Exchange. Following are the some benefits :
1) It involves no management costs or other recurring expenses.
2) The product is a lot more cost-effective for people who have a long investment horizon
3) charges involved are a one-time transaction fee of 2-3 paisa per gram and a brokerage fee of 0.2-0.3%.
4) E-gold can be converted into physical gold for quantities as small as 8 gm, while gold ETFs offer the option of physical delivery but only for a denomination of over a kilogram.
5)Besides, the delivery centres of the National Spot Exchange are located in 15 cities, while ETFs have only one delivery centre in Mumbai.
6) E-gold can also be directly converted into jewellery through select, reputed jewellers that conform with the purity and transparency guidelines. The investor only has to pay for the making charges. The National Spot Exchange aims to bring all branded jewellers under its umbrella of empanelled jewellers within a year.
7) e-gold directly tracks the domestic, physical gold prices, gold ETF only mirrors them. Certain gold ETFs have the flexibility to invest up to 10% of the total net assets in money market instruments and this can lead to tracking error. Some ETF companies also invest in gold futures and in a basket of gold mining companies.
8) One can trade in gold ETFs only till 3.30 p.m., while e-gold can be traded till 11.30 p.m., providing the investors greater flexibility and global cues while trading in gold domestically.