How does investing in gold compare with investing in mutual funds and what scores higher on the risk and return scale
Answer
Answer
Particulars
Gold Investment
Mutual Fund
Definition
Gold is a precious high-value metal that is liquid in nature
Pools investors’ money in equities, debts and other market instruments to multiply money
Management
Investments are made and managed by the investor himself
Experts manage the investment professionally to create wealth and reduce risks
Risk Involved
Physical carrying and storage of gold involves high risks of theft and burglary
Investment in mutual funds can be done with safe and secure methods
Returns
Gold does not pay any dividends
Mutual funds yield substantial returns to the investor
Investment Cost
Taking an average cost of Rs. 31 thousand per 10 grams, one needs to carefully think before making an initial investment in gold; considering the high cost to begin investing
Mutual fund investment is affordable and flexible. One can begin investments from Rs 1000 and do SIPs at as low as Rs.500 each month