Friends, if we talk about Gold then in 2019, Gold prices used to be at Rs 30000
As of now, Gold has crossed over Rs 50,000
In terms of percentage, Groww's gold price has increased by 60% in the last year
What happened in the last year which caused the rise in price and the reasons behind it
Should you still invest in Gold or not and what are options available to invest in Gold?
We will talk about these things in today's video
I, Jagdeep Singh, Welcomes you to Groww's Youtube Channel
We will talk about Gold today, the reason behind the rise in gold prices, and can it rise more in the future?
other than this, what are the other options of investing in Groww?
Friends, If you have not subscribed to Groww's Youtube Channel yet
Subscribe it!
cause we put 3 to 4 videos on educational purposes here
which will help you in being a good investor
Let's start today's video!
Friends, many people say they have stopped buying gold as the prices have risen a lot
In the Indian market, people have reduced their making of gold jewelry still why is the price not coming down?
Still, the price is rising up
So are there other reasons except for the jewelry making which impacts the gold prices
People have this misconception about Gold
that even when lesser jewelry is been made, why is the price going up?
I will try to get rid of that misconception
and explain what are the other reasons except for jewelry making which impacts the prices
directly or indirectly?
Friends, you know, Gold as an investment is very important in different parts of the world
In developed countries, gold is not used as much for jewelry as much as it is used for investment
like I have told you many a time that while investing, you must diversify your portfolio
Diversification means you invested a part of your money in equity, debt
and many people in order to hedge their positions
so that if the market goes down then their whole portfolio should not go down
Normally it is said that when there is fear in the market
many investors start taking their money off equity, debt and putting it into gold
You might have seen from the time COVID started, Gold prices started going up heavily
cause, whenever there is uncertainty in the market and share market might go down
but Gold won't go down cause Gold is considered to be a stable investment option
People use it to diversify and when there is uncertainty in the market like we saw in the last few months
From the time COVID started, Gold prices started rising up
but after that, the prices stabilized for a bit
cause people felt during the recovery after coronavirus will start immediately once its over
but the lockdown has been on since a long time cause of which economic activities completely stalled
After which people started thinking that the economic recovery after this will take time
cause of which people felt Gold can be a good option for investing the cause of the assumption that gold is safe
as it is believed whenever there is uncertainty, Gold is considered as a good investment option
When investors start getting attracted to Gold then Gold prices automatically starts going up
Friends, this is a normal supply and demand game
Supply would not have increased by much in recent times but demand would have increased in lockdown
cause everybody started investing in gold suddenly cause of which gold prices started going up
thus the primary reason for the rising prices, uncertainty and fear in the market to invest in other options
due to which people felt gold can be a good investment option and as people started buying gold
due to the demand and supply mechanism, the gold prices started going up
Friends, now I will tell you the relation between Gold and interest rate
when the interest rate goes down, how does the gold prices go up
Friends, you might know, when there is a slowdown in the economic activity of any country
the central bank there starts to reduce the interest rate
cause it is believed that the capital can be used to infuse extra in the market and economy
cause of which economic expansion starts happening
From the start of COVID in order to tackle the economic condition, the central banks have reduced the interests
and many countries reduced their invest rate by a huge margin which made many people thought
that gold might be a very good investment option cause gold is still giving good returns to its investors
so normally when the interest rates of any country start going down, the gold prices start rising up
Friends, Gold is considered to be a good inflation hedge, if you have invested in gold then
then you don't have to be afraid of inflation
Normally when there are uncertainty and fear in the market, the interest rate starts going down
all countries start printing extra currencies and cause of this the currency value trades down
thus countries inflation starts rising and in this situation, for inflation hedge gold is considered a good option
Gold is a good inflation hedge option cause of which investors had started getting interested in it
and cause of which gold prices are continuously rising
Friends, there is uncertainty from the economic perspective cause of which
cause of which Gold prices went up but if we talk about Geo-Political situation then
as you know, there have been tensions between many countries, US Chian, India China among others
Friends, when the geopolitical relations are at risk, investors start getting panicky
cause investors feel if there is any problem at the geopolitical level, the share market won't perform well
investors feel economic activities won't expand well
and when the geo political tensions increase as we have seen in the past
then the investment in gold increases as Gold is considered as a safe investment option
It is believed that the gold doesn't get impacted comparatively than other investment options
cause of investors start getting attracted to gold and the prices start getting increased
Let's discuss what is the experts take on if the gold prices will keep increasing in the future as well
Experts say till there is uncertainty in the economic conditions and at geo-political stage
till then the gold prices will keep increasing, By how much more it will increase, nobody knows
You can research on gold and decide on investing in it
I cannot tell whether the price will increase or decrease but gold can always be a good investment option
in your portfolio thus you must think of investing from the point of view of your portfolio
one small portion should be for equity, another for debt and a portion for other assets investment
and you can make a small investment in gold
By investing in gold, you can take benefit of diversification
and when the share market goes down, it is believed that the gold prices will go up
After this, Friends, let's talk about how you can invest in Gold?
In order to invest in Gold, you can go to the Gold platform
The option to invest in Gold is available only on web as of now, not on the phone
so you can log in with your credentials on web wherein you will find a tab for gold beside stocks
You can click on it and invest in Gold
It's very easy to invest in Gold via Groww. You can invest in just two clicks
after which if the gold prices increase, you will be benefited
but I again will ask you to analyze your risk and portfolio and then decide whether or not to invest in Gold
There are other ways as well to invest in Gold, like in Gold Mutual Funds, these mutual funds invest in gold
other than this, there are ETFs, Exchange Traded Funds, from which you can take exposure in Gold
so, friends, gold can be a good investment option and many investors invest in gold and keep
Again I would like to say at the end of the video to gaze your own risk and analyze your portfolio
and invest in gold for diversification
Friends, this video was for educational purposes only, I just wanted to clear out your misconceptions
that for the rise in the price of gold, jewelry is not the only reason
other than this there are many investors who invest in gold
As an investor, think about how is gold a good investment option for you, analyze your risk
and in which ways you can invest in gold
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Comment and tell us the topics that you would like us to cover in the coming days
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Happy Investing!