Gold plays a vital role in national economics and numbers of fund managers add gold bond or paper gold in their funds. But the question is – an individual investor really needs to invest in gold? or what is the affordable limit of gold investment in personal finance? Well, before investing – keep in mind that, buying gold is NOT an investment. Rather it is a vehicle to store your money. Unlike preference, debenture or equity share – you can’t expect regular dividend from it. Rather it acts like as a fixed asset.
Practically, different financial advisors suggest a different percentage of your liquid assets. It starts from 5% to 20%. It varies from one financial consultant to another. Nevertheless, investing in gold classified under three categories. They are –
Gold Safety Portfolio: This is the most popular portfolio for common people who are not interested in investment and need to assure his/her capital. Primarily it is designed to protect the buyer’s from economic turbulence and inflation. It protects buyers from social, political, economic and currency-based crisis. It works like a financial hedge for the investor. For this portfolio, the recommended percentage of investments in Gold is – Physical gold bar/coin – 55%, Gold ETFs – 15% and Gold production stocks (gold mining stocks) 10%. Total = 80% of the gold investment and rest 20% of liquid cash or any other investment like currency ETF.
Gold Profit Portfolio: As we know, unlike other investments, gold can’t give you large profit margin; however, financial advisors design a portfolio pattern that can generate moderate profit margins from your gold investment. The main reason of it is – unless you invest lots of money you can see a noticeable profit from it. Keep in mind that, this portfolio follows “high risk and high liquidity” pattern. In this portfolio, you need not to invest in physical gold. Rather you can invest in – Gold ETF – 15%, gold exploration and production stocks (gold mining stocks) 70%. Total = 85% and rest 15% other currency ETFs
Gold Balance Portfolio (Diversified Portfolio): This is a special kind of portfolio for avid investors. It is a perfect diversified portfolio model that balances your portfolio risks with gold. In this portfolio model, you can invest in – physical gold bar/coin – 10%, Gold ETFs – 15% gold mining stocks 45%. Total = 70% and rest in currency ETFs.
However those are conceptual model of your portfolio. You must check your investment capabilities and consult with a professional, reputed financial advisor or fund manager before investing. Additionally, it is strongly suggested that, you must read all the offer documents carefully before investing.
Build your gold investment portfolio with Penta Gold Ltd. by investing in gold and make your future safe. Give us a call at 022-22402255 for secure gold investment. Our expert team will guide you for gold purchase and profitable gold investment. You can purchase physical gold, E-gold or bullion in wholesale at Penta Gold Ltd.