Investors should stick to gold-linked instruments for transparent pricing

Pricing is more transparent and some even pay interest regularly

Until a few years ago, 35-year-old Jamshedpur-based dentist Neelam Jain was your typical gold buyer. Her preferred mode of investing in the yellow metal was to purchase jewellery and gold coins. In recent months, however, she has shifted to gold-linked financial products, such as sovereign gold bonds (SGBs). “One does not worry about safekeeping or quality, as one does when buying physical gold,” she says.  

According to recent estimates by the World Gold Council (WGC), Indians hold about 24,000-25,000 tonnes of gold, which makes it a crucial asset class that most investors need to manage prudently.

Physical or financial gold? If you