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The precious metal known as gold exudes power. It stands for security in money as well as wealth and prosperity. While some people prefer to show off their wealth, others covertly amass it through a gold accumulation approach. Indians have a special affection for gold since it is a significant element of their social, cultural, and spiritual heritage.
It may be a good time for Indian households to invest in gold today and secure their future with a safe investment choice as gold continues to get attention globally and rises in price on a daily basis. Fortunately, investing in digital gold offers the average investor a terrific opportunity to accomplish just that today.
We’ll provide you with the information you need to determine if you can invest in digital gold using your bank’s Demat account, which you use to trade equities. We’ll also discuss a gold accumulation plan and how to invest in gold through a Demat account.
Table of Contents
How to Buy Gold in a Demat Account
Digital gold can be invested in various methods, some of which have been listed here.
Exchange-Traded Funds (ETFs) for Gold
With these investments, investors may invest without worrying about where to store their gold. Account holders can buy gold units to keep and sell using a Demat account. Because they are based on actual gold, gold ETFs operate similarly to mutual funds but provide their owners with a higher level of service. Gold ETF investments are attractive since they not only accept small deposits but also offer tax advantages to their owners.
Electronic Gold (or E-Gold)
Investors enjoy investing in electronic gold, often known as e-gold, in part because of how simple it is to do so. This investment, which is gold in a Demat form, necessitates that people open a unique Demat account that is dedicated solely to e-gold investments. With the help of this account, trading ‘Demat gold’ is made simple. E-gold owners have the right to purchase and sell their gold whenever it is most convenient for them and at a price that corresponds to their preferences.
Gold Funds
Like gold ETFs, gold funds are investments that resemble mutual funds. The sale and purchase of these, however, do not necessitate the use of a specialised Demat account. They provide the same investor characteristics as other gold investment programs do. Before investing their money in any of the aforementioned digital gold investments, investors and traders are urged to research each one thoroughly.
Can a Demat Account Be Used to Invest in Digital Gold?
A Demat account is not required to invest in gold. You need a Demat account in order to trade gold ETFs. You cannot invest in digital gold through a Demat account, even if you have one, because you would have to pay brokerage fees. On the other hand, purchasing digital gold online is as easy as a few clicks, and there are no further costs until you sell it or withdraw real gold from your account.
What Does ‘Digital Gold’ Really Mean?
When you buy digital gold, you are buying actual gold without obtaining control of it. Each unit of digital gold that a consumer buys is backed by 24-karat gold that has a purity of 99.5%. The consumer’s gold is safely stored in a vault and covered by insurance until he decides to redeem it and take physical possession of it. Additionally, the consumer has the choice to sell the gold to meet his financial needs.
Is Investing in Digital Gold a Wise Decision?
For some people, investing in digital gold can be a smart move, but it relies on a number of variables and your financial objectives. Here are some advantages of investing in digital gold:
A Guarantee of Excellent Work
Unless you’re an expert, it’s tough to determine the authenticity of gold purchased from a neighbourhood jewellery store. Except when purchasing gold ingots or coins, genuine 24-karat gold cannot be purchased from a jewellery store. The bulk of jewellery is composed of 22-karat gold, which has been infused with impurities to give it the desired form and pattern.
There Are No Extra Costs
You risk losing a lot of money if you think gold jewellery is a secure investment. Both the cost of acquiring jewellery and the use of pricey stones are expenses. You’ll receive a smaller return on your investment because not all of your money is put in gold. On the other hand, investing in digital gold has no additional costs, and the entire money is used to buy gold at the current market price in a digital gold investment or gold accumulation plan.
Safe Storage Facility
Providing secure gold storage is one of the main concerns for investors in real gold. Storage at home can be risky, and using a bank vault costs money and offers no assurance of secure storage or insurance coverage.
Investing in Gold Is Simple
Today, investing in gold is not only safe but also rewarding. In the past year, gold prices have increased by 16.06 per cent. In contrast to genuine gold, you don’t need to spend a fortune to take advantage of this price rise. You may use a gold accumulation method even with very few investments. The best aspect is that purchasing digital gold doesn’t require visiting a store, providing identification, or enduring difficult and time-consuming procedures.
Conclusion
An easy and accessible way for investors to purchase gold is through a Demat account. Individuals may get exposure to gold without worrying about actual ownership, storage, or security by choosing gold mutual funds or ETFs.