Reasons Why Indians Like Gold Investment

A very important part of wealth management is investing the present corpus in such lucrative sources where the expected returns are commensurate to the risk involved and opportunity cost or returns in a comparable opportunity foregone for such investment.

In India however gold is the most preferred source for investment due to a number of reasons such as:

  • Investment in gold has for long been considered a great option by Indians due to the poor state of the economy before policy liberation back in 1991.


  • Even after the economy was opened, a number of recessions have made them feel that gold is a friend for both rainy and sunny days.


  • In developing nations such as India inflation and prices are always on the rise hence they make precious metal investments appear very safe. This is because gold bar price in India as compared to the Indian currency offers a safer option.


  • Investment in gold is done with a long term approach.


  • In India gold is considered to be used as liquid wealth which can come very handy in times of crisis.


  • Investment in gold or buying gold in India exchange traded funds or mutual funds is considered a safer option than equity since one does not have to worry about a price crash or manner in which a management is running a business.
  • Gold offers average returns of about 10% over a long term horizon but it is not a complex investment and thus preferred by the average Indian.

  • The demand for gold and thus investing wealth in same is always a good option for Indians since it is used for births, weddings, festivals as well as religious ceremonies ins pite of a dip in 24 carat gold prices in India recently. They also are a favourite choice when it comes to legacies and heir looms. Thus, it has a demand irrespective of class as it permeates the very core value systems of the Indian cultural persona.
  • It provides a great option to hedge against possible future exigencies.


  • It is fungible that is a particular piece can be exchanged for a number of smaller pieces.


  • It is a symbol of status, rarity and wealth and is considered in accordance to the old adage truly timeless.

22 carat gold prices are falling due to correction with a global resurgence in economic welfare. Hence, the best idea is to go long term in gold right now.

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