Investing · 3 min read
Investing in Gold
Gold is a store of value that historically preserves purchasing power during crises and inflation.
Why it matters
A small gold allocation can smooth portfolio returns and hedge against currency risk.
Advantages
- Inflation hedge
- Uncorrelated with equities
- Liquid globally
Risks
- No income yield
- Storage & making charges (physical)
- Price volatility
Real-world example
Sovereign Gold Bonds pay 2.5% interest and track gold prices — no storage risk.
Key takeaways
- Prefer SGBs or gold ETFs over jewellery for investment
- Cap gold at 5–15% of the portfolio
- Gold shines in bad times, not good ones
Quick quiz
1. Which form of gold pays interest?