Want to buy gold on Akshaya Tritiya? What will get you more money? Check profitable move

Akshaya Tritiya 2020: India is going to celebrate Akshaya Tritiya on 26th April 2020. On this holy occasion, we have a tradition of buying gold, but during the Coronavirus lockdown, it seems difficult to buy physical gold from a gold jewelry shop. So, one will have to remain content with the electronic gold options like Gold ETF, Sovereign Gold Bond, etc. But, those who still want to buy physical gold, they can go for gold coins purchase from various banks operating during lockdown.

Speaking on the gold options available during Coronavirus lockdown; Anuj Gupta, Deputy Vice President — Commodity & Currency at Angel Broking said, "There are more options available to buy gold like Gold ETFs from exchange, sovereign gold bond and gold coins from the banks." 

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Highlighting the importance of buying gold on Akshaya Tritiya, Gupta said that when you compare gold price this year and last year, the net return is around 47 per cent, which is huge. Gupta said that the Gold price trend is still positive on the back of uncertainty and lower global growth forecast saying, "We are expecting Safe haven demand as it always supports gold prices. This time Gold is trading at higher levels (recently gold touched the life time high of 47,327 levels), and technically we are recommending that investors wait for some correction till Rs 38,000 to Rs 40,000 to buy gold for the target of Rs 50,000 to Rs 52,000 per 10 gms. In international market, gold may test $1780 to $1800 levels. Closing above $1800 levels may lead this rally towards $1880 to $1950 levels."

Suggesting electronic gold instead of gold coins, Kartik Jhaveri, Director — Wealth Management at Transcend Consultants said, "Buying gold coins from bank is not advisable even when during the normal days as it costs around 3-5 per cent higher than the physical gold market. If someone goes to buy gold coins on Akshaya Tritiya 2020, then it will cost him or her more than the other available gold resources like Gold ETF or Sovereign Gold Bond. My suggestion to prospective gold buyers this Akshaya Tritiya is Gold ETF or any other source of electronic gold. They rise of fall as per the sport gold and give returns in same sync. Apart from this, while selling, there is no depreciation cost involved." He said that depreciation cost involved in the gold market is around 4-5 per cent. So, buying gold coins from banks would cost around 10 per cent more to the gold buyer. So, it's better to buy electronic gold instead of gold coins.

Speaking on Gold ET investment Pankaj Bobade, Head - Fundamental research at Axis Securities said, "Gold is a hedge against uncertainty and a good investment vehicle, especially in the current scenario. With the COVID-19 pandemic bringing the world economy to a standstill and a possible contraction ahead, gold seems an attractive option. Moreover, as the Central Banks of developed nations have been on easing spree to fight the economic contraction, the fiat currencies are expected to face pressure in the near future. In such a scenario,  gold is likely to emerge as a safe-haven asset. One should have a part of the portfolio invested in Gold ETF as an insurance against the possible volatilities expected in the global financial market. So, if this Akshay Trithia you are looking to buy gold, Gold ETF would be a good option from a long-term perspective."