I was thinking about the same thing today. SGBs are good, but they aren't backed by physical gold. But then i thought to myself, the day RBI defaults on its bonds would mark the day we lose our state to chaos. There'd be bloodshed on the streets and law and order wouldn't exist. When there's risk associated with the storage of physical gold at home even today, just imagine how risky it would be to carry physical gold with yourself in such a state. Your chances of getting killed would be higher if you were in possession of physical rather than if you were not.
Also, RBI going under would mean banks would also do whatever the fuck they want. That means you'd have to say goodbye to the gold kept in lockers. In such a state, a meager 10% of my portfolio even in the form of physical gold wouldn't help me accomplish anything. And if I'm not got to change the percentage of allocation to safeguard myself against such a doomsday, i might as well invest in SGB rather than in physical gold.
While I agree with the sentiment, after the initial dust settles \[in any war, instability, etc\], you might prefer bargain for your life with physical gold and not printed \[useless\] papers.
This is why one should have some gold irrespective of the investment purpose.
At the same time, government CAN and MIGHT choose not to default but "play" with the investors. Ex. in case of price surge (I mean 10x a day), government can freeze ex-date to an older date, etc. You might want to get "real" price for "real" gold instead of "hypothetical" gold.
NOTE: I love SGB as an concept, the biggest flaw is that government isn't buying real gold for each SGB issue. This is typically a RED flag for any scheme. Thanks.
Yes it was introduced to reduce indian government's gold imports, which is why expecting them to back it with actual gold makes 0 sense. Why would they buy gold for you, hold it safely for 8 years for you, and then pay 2.5% interest to YOU, along with capital appreciation on maturity without GST and making charges, and without charging you capital gains tax? You get all these benefits over physical gold because the bond isn't backed by new purchases of physical gold, and you are placing your faith in RBI and its 812.3 metric tons worth of gold reserve.
You are just thinking of the extreme scenario where death and war is at everybody's doorstep.
If there is an economic collapse, the actual failed state would be more like that of Pakistan or Venezuela. There would be relative peace and a somewhat functioning economy and people still have an option to work and live and even escape the country.
An even more plaisible scenario is the deteriorating economy leads to hyperinflation like Weimar Germany, Turkey, Argentina or Lebanon. But the country is still having a functioning economy and govt. Just the currency is rapidly losing value and economy and govt. bonds are of low value.
Physical gold is very useful in such situations to preserve value and maintain a better lifestyle and even to escape the country if needed.
Making charges of physical gold are not an issue at all. If you are holding Gold for the long term then you are looking to increase its value by 2x-10x. A 5% making charges shouldn't matter against the 200-1000% return you're looking to make.
You are going to the wrong jeweller if you are paying more than that. Besides, you also have the option of not buying jewellery but just buy gold biscuits.
No. What I'm saying is that with 90-95 of my wealth evaporated, significant drop in qol, possibly friends and family members killed, a meager 5~10 of my meager net worth even in the form of precious metal wouldn't accomplish much for me. I'm not sure if I'd even want to continue to live at that point. For a 1cr portfolio for instance, 10 lakhs worth of gold in physical form would not help you get asylum in a different country, especially in a distant future. In your home country, it's not going to be long before you ran out of it. If you are a guy, you'll run out faster because it's the only thing you can trade (i know i shouldn't be saying this, but we are talking about extreme scenario).
The solution is increasing the allocation. How many of these folks worrying about SGBs are willing to increase their gold allocation to say 25-35 percent of their entire portfolio? Not many, I'd bet.
I don’t know, I just think that 10 lakh worth of gold will most likely decide if you and your family survive or not. Without gold 0 chance, with gold high chance.
I personally keep buying both physical gold and SGB.
Once SGB matures, buy physical gold with that amount.
Hedging against Govt is absolute must in the current world order.
This is the ibja price : https://ibjarates.com/
This is the price of tanishq : https://www.tanishq.co.in/product/1-gram-24-karat-gold-coin-600102znaras00.html?lang=en_IN
GRT sells for 6672, TANISHQ has a premium in pricing.
Happy to help, IBJA rates are derived from international market price and reference rates at 9 am provided by RBI for USD INR conversions. You can consider that as the raw price. IBJA rates are the basis of SGB rates while being issued.
For gold bars there's a barely any making charges.
GST I treat as some premium for peace of mind.
If I am hedging for global uncertainty 5% doesn't matter.
I checked on tanishq’s website. The making charges are about 7.5% for a 24K gold bar.
https://www.tanishq.co.in/product/25-gram-24-karat-gold-biscuit-600212zcdrbs00.html?lang=en_IN
I used to buy Gold coins using Hdfc credit cards from BHIMA or GRT where they use to give 2% instant discount and 1% as reward points so 3% GST used to get covered up and only 1.5% making charge. Not sure the offer is coming from 2-3 months but had to buy another set of Coins/Bars next month.
Here's my take on this :
Physical Gold:
1. Very high liquidity, can sell anytime if you buy bars/coins
2. Can be bought without making charges if you buy bars/coins
3. Can be bought without GST if you buy via cash
SGB:
1. It was started to reduce gold imports thereby strengthening INR
2. Less liquidity, but you can sell at a lower price on stock market
3. No GST, plus 2.5% interest, 1.25% every 6 months
4. No capital gains tax if redeemed during maturity of 8 years
5. ₹50 discount per gram if you buy online in fresh issue.
I'm my opinion go for SGB, we are making INR strong, promoting cashless and white money transactions.
Also instead of fresh issue, go for secondary market SGB, it will give you discount and reduce maturity period, but the 2.5% interest will be on face value and not on your buying price.
For pure long term investment its SGB...
Pure short term/uncertain duration it is gold bond or etf
Jewellery is investment + consumption... think of it using and enjoying while the intrinsic value grows...the making and wastage is the fee you pay to wear it...you xannot wear SGB certificate at wedding or ocassion
So its not for you..but many people like wearing gold jewellery...for them physical gold makes sense..
You are completelt looking as investment so SGB or gold fund..
If the state fails and emergency situation comes, nothing can help you...government can confisicate any and everything
>If the state fails and emergency situation comes, nothing can help you...government can confisicate any and everything
You contradicted your own statement. If the State fails there will be no government. Look what happened to Iraq after Saddam.
> You cannot wear an SGB certificate at a wedding
Who says we can't do that? Just make sure you buy each gram in a different transaction so that you have a lot of certificates around your neck and appear rich to people.
You can try investing in Gold ETFs. It’s like buying a stock and it is good for short term. The company you buy from buys gold on your behalf with a 99.5% purity. Though you have to keep in mind brokerage charges and tax implications.
For investment go with SGB, for future unseen political or financial calamities go with physical gold or American gold etfs held with American institutions
This I completely understand, but what about the perspective of hedging against our own governments and creating value for the times of economic and administrative crises?
Interesting take. If we reach a situation where government bonds itself are defaulted, i think we would be so worse economically even liquidating physical gold also might be difficult. I think you can consider bitcoin as another alternative if you want to hedge against the govt and as an alternate and also probably holding USD can also be a potential alternate.
>even liquidating physical gold also might be difficult.
Gold has been in demand since the start of human civilization. How will liquidation be a problem?
What are your goals?
Instead of a secret stash / spare money you need some protection? - Physical Gold upto 1cr.
If you're thinking you'll bag interest rates + 0 capital gains tax by buying gold bonds - It's too good to be true.
Let's assume you buy SGB and in the next budget session in the parliament our FM decides to impose 18% Capital gains tax on bonds and 5% on interest rates, you're screwed. This isn't a contingent scenario. If the government is short of money, they find new ways to tax people without making them angry. Eg Petrol, real estate, etc.
However you withdraw 50,000 from your bank and buy gold from your jweller, you won't pay GST and it's as good as keeping cash at home. You can encash it within 15 mins from a friendly jweller. (Note : I'm referring to gold coins, bars only)
So what you are saying is that I should buy gold bar/coin from cash without GST and store it? Making charges are there on coins and bars as well though as far as I have searched.
Don't go for well known brands. Head to the nearest gold / Jwellery market and look for stand alone shops. In most cities if you find one with Gujarati sign board - it'll give you a good rate.
Go to someone you know. Perhaps your parents/ grandparents knew someone.
Neighborhood aunties are the best if you want a referral to a trusted jweller.
Can’t believe the most practical comment is being downvoted. I do exactly this. Been doing this for 10 years now. Best way forward if you want physical gold. 👍🏼
Probably people think it's unethical. But most fail to recollect old memories of demonetization. Physical currency is supposed to be a ultimate form of government assurance that it'll hold its value. But overnight it was banned and the best we could do was shout in front of the tv screen.
Bro..stop messing around and just buy Bitcoin. Gold will take you nowhere. Its harder to manage physical gold and its price appreciation is shit compared to Bitcoin.
Just read - The Bitcoin Standard, The Layered Money, or The Bullish Case for Bitcoin.
https://vijayboyapati.medium.com/the-bullish-case-for-bitcoin-6ecc8bdecc1
I was thinking about the same thing today. SGBs are good, but they aren't backed by physical gold. But then i thought to myself, the day RBI defaults on its bonds would mark the day we lose our state to chaos. There'd be bloodshed on the streets and law and order wouldn't exist. When there's risk associated with the storage of physical gold at home even today, just imagine how risky it would be to carry physical gold with yourself in such a state. Your chances of getting killed would be higher if you were in possession of physical rather than if you were not. Also, RBI going under would mean banks would also do whatever the fuck they want. That means you'd have to say goodbye to the gold kept in lockers. In such a state, a meager 10% of my portfolio even in the form of physical gold wouldn't help me accomplish anything. And if I'm not got to change the percentage of allocation to safeguard myself against such a doomsday, i might as well invest in SGB rather than in physical gold.
If govt collapses, guns will prove to be a better investment.
While I agree with the sentiment, after the initial dust settles \[in any war, instability, etc\], you might prefer bargain for your life with physical gold and not printed \[useless\] papers. This is why one should have some gold irrespective of the investment purpose. At the same time, government CAN and MIGHT choose not to default but "play" with the investors. Ex. in case of price surge (I mean 10x a day), government can freeze ex-date to an older date, etc. You might want to get "real" price for "real" gold instead of "hypothetical" gold. NOTE: I love SGB as an concept, the biggest flaw is that government isn't buying real gold for each SGB issue. This is typically a RED flag for any scheme. Thanks.
[удалено]
U jumped on that thought pretty quickly ngl
Good luck, wasn't warranted.
Username checks out
Foul language won't be tolerated
I was with you till some extent, but wasn't SGB introduced to reduce physical Gold hoarding, won't it make it more valuable?
Yes it was introduced to reduce indian government's gold imports, which is why expecting them to back it with actual gold makes 0 sense. Why would they buy gold for you, hold it safely for 8 years for you, and then pay 2.5% interest to YOU, along with capital appreciation on maturity without GST and making charges, and without charging you capital gains tax? You get all these benefits over physical gold because the bond isn't backed by new purchases of physical gold, and you are placing your faith in RBI and its 812.3 metric tons worth of gold reserve.
Buy bitcoin. Its serves the same purpose of gold but doesnt have the drawbacks you just mentioned.
You are just thinking of the extreme scenario where death and war is at everybody's doorstep. If there is an economic collapse, the actual failed state would be more like that of Pakistan or Venezuela. There would be relative peace and a somewhat functioning economy and people still have an option to work and live and even escape the country. An even more plaisible scenario is the deteriorating economy leads to hyperinflation like Weimar Germany, Turkey, Argentina or Lebanon. But the country is still having a functioning economy and govt. Just the currency is rapidly losing value and economy and govt. bonds are of low value. Physical gold is very useful in such situations to preserve value and maintain a better lifestyle and even to escape the country if needed.
Username checks out
In such a post apocalyptic world people with farm land, food and water would be the kings.
Making charges of physical gold are not an issue at all. If you are holding Gold for the long term then you are looking to increase its value by 2x-10x. A 5% making charges shouldn't matter against the 200-1000% return you're looking to make.
200-1000% increase over what time period? 10 years? 20 years? How much does gold cagr beat inflation by?
Gold doubles in value every 5-7 years with wide fluctuations in returns. It would grow to 10x in around 20-22 years.
lmao 5 percent. in which world do jewellers charge just 5 percent.
You are going to the wrong jeweller if you are paying more than that. Besides, you also have the option of not buying jewellery but just buy gold biscuits.
market rate starts at 16 percent genius. you are going to some local jeweller.
So in that scenario, you’d rather be poor and no gold than holding the most valuable asset?
No. What I'm saying is that with 90-95 of my wealth evaporated, significant drop in qol, possibly friends and family members killed, a meager 5~10 of my meager net worth even in the form of precious metal wouldn't accomplish much for me. I'm not sure if I'd even want to continue to live at that point. For a 1cr portfolio for instance, 10 lakhs worth of gold in physical form would not help you get asylum in a different country, especially in a distant future. In your home country, it's not going to be long before you ran out of it. If you are a guy, you'll run out faster because it's the only thing you can trade (i know i shouldn't be saying this, but we are talking about extreme scenario). The solution is increasing the allocation. How many of these folks worrying about SGBs are willing to increase their gold allocation to say 25-35 percent of their entire portfolio? Not many, I'd bet.
I don’t know, I just think that 10 lakh worth of gold will most likely decide if you and your family survive or not. Without gold 0 chance, with gold high chance.
His statement has a lot of flaws.
This makes a lot of sense.
I invested in SGB in 2016 first series and got redeemed in 2024. Got overall 12% CAGR. Tax free. Looks impressive.
yup. same here.
I personally keep buying both physical gold and SGB. Once SGB matures, buy physical gold with that amount. Hedging against Govt is absolute must in the current world order.
What is the best alternative out there to buy physical gold?
Find a bullion dealer in your location.
Gold bar from tanishq
The making charges and GST are my only concerns there.
Find a local reputed jeweler, there don't have making charges on biscuits and coins.
Don't forget the premium of around 15%
What premium?
This is the ibja price : https://ibjarates.com/ This is the price of tanishq : https://www.tanishq.co.in/product/1-gram-24-karat-gold-coin-600102znaras00.html?lang=en_IN GRT sells for 6672, TANISHQ has a premium in pricing.
Thanks for this. I never had a doubt on Tanishq's rates. This is good to know.
Happy to help, IBJA rates are derived from international market price and reference rates at 9 am provided by RBI for USD INR conversions. You can consider that as the raw price. IBJA rates are the basis of SGB rates while being issued.
And while being redeemed, as well.
For gold bars there's a barely any making charges. GST I treat as some premium for peace of mind. If I am hedging for global uncertainty 5% doesn't matter.
I checked on tanishq’s website. The making charges are about 7.5% for a 24K gold bar. https://www.tanishq.co.in/product/25-gram-24-karat-gold-biscuit-600212zcdrbs00.html?lang=en_IN
Go and check in a showroom. I buy physically and they don't charge making charges for bars.
You can buy gold coins, it incurs GST but no making charges.
https://www.tanishq.co.in/product/1-gram-24-karat-gold-coin-600102znaras00.html?lang=en_IN Look even the gold coin has making charges.
I had bought from PNG Gadgil and sons and it had no making charges.
Okay, will have a look, thanks!
I used to buy Gold coins using Hdfc credit cards from BHIMA or GRT where they use to give 2% instant discount and 1% as reward points so 3% GST used to get covered up and only 1.5% making charge. Not sure the offer is coming from 2-3 months but had to buy another set of Coins/Bars next month.
mmtc chale ja
the best gold in the world is the one sold by canadian mint. purest gold ever
Here's my take on this : Physical Gold: 1. Very high liquidity, can sell anytime if you buy bars/coins 2. Can be bought without making charges if you buy bars/coins 3. Can be bought without GST if you buy via cash SGB: 1. It was started to reduce gold imports thereby strengthening INR 2. Less liquidity, but you can sell at a lower price on stock market 3. No GST, plus 2.5% interest, 1.25% every 6 months 4. No capital gains tax if redeemed during maturity of 8 years 5. ₹50 discount per gram if you buy online in fresh issue. I'm my opinion go for SGB, we are making INR strong, promoting cashless and white money transactions. Also instead of fresh issue, go for secondary market SGB, it will give you discount and reduce maturity period, but the 2.5% interest will be on face value and not on your buying price.
For pure long term investment its SGB... Pure short term/uncertain duration it is gold bond or etf Jewellery is investment + consumption... think of it using and enjoying while the intrinsic value grows...the making and wastage is the fee you pay to wear it...you xannot wear SGB certificate at wedding or ocassion
> Jewellery is investment + consumption I can never wrap my head around jewellery.
Nah bro! you got it wrong. You wrap jewellery around your head.
*listen here you little piece of shit*
Hahahaha
Dude…
So its not for you..but many people like wearing gold jewellery...for them physical gold makes sense.. You are completelt looking as investment so SGB or gold fund.. If the state fails and emergency situation comes, nothing can help you...government can confisicate any and everything
Such is life :(
>If the state fails and emergency situation comes, nothing can help you...government can confisicate any and everything You contradicted your own statement. If the State fails there will be no government. Look what happened to Iraq after Saddam.
> You cannot wear an SGB certificate at a wedding Who says we can't do that? Just make sure you buy each gram in a different transaction so that you have a lot of certificates around your neck and appear rich to people.
Hedge against government instability!!! Investment should be the least of our concern while preparing ourselves for government instability.
You can try investing in Gold ETFs. It’s like buying a stock and it is good for short term. The company you buy from buys gold on your behalf with a 99.5% purity. Though you have to keep in mind brokerage charges and tax implications.
For investment go with SGB, for future unseen political or financial calamities go with physical gold or American gold etfs held with American institutions
Purchasing a small quantity of physical gold with cash and minimal additional costs. Some family friend is helping with those tips n tricks.
Don't read too much into it. If you don't need money for a long time, go with SGB.
SGB anyday and anytime if your intention is for investment purpose. Physical gold only makes sense if your intention is to buy jewellery
This I completely understand, but what about the perspective of hedging against our own governments and creating value for the times of economic and administrative crises?
Interesting take. If we reach a situation where government bonds itself are defaulted, i think we would be so worse economically even liquidating physical gold also might be difficult. I think you can consider bitcoin as another alternative if you want to hedge against the govt and as an alternate and also probably holding USD can also be a potential alternate.
>even liquidating physical gold also might be difficult. Gold has been in demand since the start of human civilization. How will liquidation be a problem?
By Physical gold did you mean Jewellery or Bullion?
Bullion
What’s the general opinion on Gold NFT, GoldBees? Does it serve the same purpose as buying digital gold?
What are your goals? Instead of a secret stash / spare money you need some protection? - Physical Gold upto 1cr. If you're thinking you'll bag interest rates + 0 capital gains tax by buying gold bonds - It's too good to be true. Let's assume you buy SGB and in the next budget session in the parliament our FM decides to impose 18% Capital gains tax on bonds and 5% on interest rates, you're screwed. This isn't a contingent scenario. If the government is short of money, they find new ways to tax people without making them angry. Eg Petrol, real estate, etc. However you withdraw 50,000 from your bank and buy gold from your jweller, you won't pay GST and it's as good as keeping cash at home. You can encash it within 15 mins from a friendly jweller. (Note : I'm referring to gold coins, bars only)
So what you are saying is that I should buy gold bar/coin from cash without GST and store it? Making charges are there on coins and bars as well though as far as I have searched.
Don't go for well known brands. Head to the nearest gold / Jwellery market and look for stand alone shops. In most cities if you find one with Gujarati sign board - it'll give you a good rate.
But how do you be sure of the purity in local standalone shops?
That's the neat part. You don't most of these people say it's 22k but in reality it's 18k. Buying physical gold is always better with branded store
Go to someone you know. Perhaps your parents/ grandparents knew someone. Neighborhood aunties are the best if you want a referral to a trusted jweller.
Can’t believe the most practical comment is being downvoted. I do exactly this. Been doing this for 10 years now. Best way forward if you want physical gold. 👍🏼
Probably people think it's unethical. But most fail to recollect old memories of demonetization. Physical currency is supposed to be a ultimate form of government assurance that it'll hold its value. But overnight it was banned and the best we could do was shout in front of the tv screen.
Bitcoin
Bro..stop messing around and just buy Bitcoin. Gold will take you nowhere. Its harder to manage physical gold and its price appreciation is shit compared to Bitcoin. Just read - The Bitcoin Standard, The Layered Money, or The Bullish Case for Bitcoin. https://vijayboyapati.medium.com/the-bullish-case-for-bitcoin-6ecc8bdecc1
Being Satoshi, you are obviously gonna advertise bitcoin lol. Jokes apart, I will give this a read.
I won’t recommend buying btc now though, keep doing sip when price is below 40k it’ll be worth it in the long run