Gold: safest and better investment especially in such crisis- Mr. Amrute

Why is gold all-time safe and the best investment? Why one should invest in gold especially in such pandemic  explains Mr. Rahul Amrute, who runs one of the oldest and reputed Jewellery store -Dattatray Pandurang Amrute Jewellers at station road of Thane. He speaks exclusively with KYT.

Excerpts from the interview.

What is your anticipation with respect to the gold prices?

It won’t be wrong if we say that, gold was the future, is the future and will be the future. Gold has been the most ancient source of value and exchange medium. In the first place we need to appreciate and understand the very nature of gold. It is an universal currency, easily convertible to paper money, its source is limited (one can’t keep on mining gold forever) and it’s indestructible. All these aspects of gold make it an extremely safe and reliable source of investment. With respect to the future rates of gold, I am very bullish. From 42k in March 2020 to 57k in August 2020, and then a rate correction to 52k is an indication of the rates running north in the near future. At present, the world is grappling with COVID-19 and we have already started seeing signs of an economic meltdown, I think we should be prepared for higher rates in the future.

How do you time the market for maximum profit?

It’s always better not to time the market because in the current turmoil it’s just not possible. Economists can possibly predict a trend in the long run but what’s in store in the next month, or the next six months is something that’s hard to say. So buy gold whenever you can, whatever quantity you can, if it’s for a long term use you will not be let down, that’s a promise. Short term investors better explore other options. Investing in SGB (Sovereign Gold Bonds) can be a good option to earn some interest without having the stress of keeping physical gold, but nothing beats having the yellow metal in hard form.

What is hallmarked jewellery? How does it actually benefit the consumers?

Hallmark is a mark of assurance that your gold is of the same purity as sold to you. It assures full weight when you sell or exchange it. The BIS (Bureau of Indian Standards) certifies the jewellery but one important aspect the customer should check is whether your jeweller is an authorised hallmark outlet. Ask for the BIS membership certificate when buying the jewellery..

Many say gold does not give returns like MF, real estate, then why should one choose gold over them?

To answer this question let’s understand gold in the right perspective. In simple parlance, gold is money. When we say gold is money, it’s given that it is not expected to give yield. Money does not give yield on its own. If you keep a lakh rupees in a cupboard and open it after six months it will still be the same. Similarly, 100g gold will remain 100g after six months. However, if you keep that 1lakh as a fixed deposit, then it yields revenue. But it is important to note that it’s a risk asset and not just money. I would go one step ahead and say that gold yields income despite not being a risk asset. It’s the only asset class that increases it’s valuation by just storing it. So to conclude gold is that child in your family who is not expected to even score passing marks in his board exams but passes with a distinction. Gold can therefore not be compared to any other investment option.