This Dusshera, Invest in Gold the Smart Way

Dusshera across India holds prime importance as we celebrate the victory of good over evil, new over the old, thereby making new beginnings. This festival is celebrated with an important ritual of purchasing Gold. Some prefer to buy gold jewellery, while some buy it as an investment. In fact, we Indians have an insatiable appetite for gold as a symbol of auspiciousness to usher in prosperity for the future.

Today more and more investors are opting for a thoughtful way to invest in Gold. This Dusshera, recognise why gold is an inevitable investment option and why it should be held in your portfolio as an investment diversifier.

Gold Remains a Strategic Portfolio Diversifying Asset Class

One of the key ways to invest thoughtfully and balance your portfolio is to invest in Gold as an asset class. Generally, when there is stress & swings in equity markets, the Gold in your portfolio due to its inverse relationship with equity, helps reduce downside risks.

For instance, during the Pandemic-induced market crash, when equity markets fell by 28% early in 2020, a balanced investment in Equity & Gold had seen a lesser downward pressure than an investment in equity mutual funds alone.

Fig 1: How a balanced allocation using Gold could have protected investors during the Covid-induced market crash

Here are the Properties of Gold - the Strategic Risk-reducing Portfolio Diversifier:

Fig 2: Properties of Gold

The festive season is the perfect opportunity to add or start allocating to gold holdings such that it occupies 20% of your investable corpus. Learn how to balance your portfolio with Gold using our tried and tested 12:20:80 (Baarah, Bees Aur Assi) Asset Allocation Calculator.

Why Move Beyond the Traditional Way of Investing in Gold

Today’s investors can invest in gold mutual funds and ETFs that are convenient rather than opting for buying physical Gold due to the following reasons:

Fig 3: Traditional Gold vs Mutual Funds

How does Gold ETF/Mutual Fund Compare with Other Financial Forms?

Though there are various new ways to invest in gold such as Digital Gold and Sovereign Gold Bonds, investing in Gold ETFs and mutual funds are efficient and liquid modes of investment.

Fig 4: Comparison with Other Financial Forms

As you see in the figure above, Gold ETF and Gold Mutual Fund have several benefits in terms of convenience and liquidity that warrant an allocation in these innovative modes of Gold.

Reasons to Invest in Quantum Gold Savings Fund

Buying gold during the festive season has been a tradition in India & most people prefer to invest in physical gold which involves purity concerns and making charges. However, it’s time for you this festive season to make a smarter choice and move to options that are convenient and hassle-free. This Dusshera calls you to overcome the age-old approach of buying Gold and adopt a smart and thoughtful way to invest in one of the most important asset classes within your portfolio.

Name of the Scheme	This product is suitable for investors who are seeking*	Riskometer of scheme
Quantum Gold Fund An Open Ended Scheme Replicating / Tracking Gold	• Long term returns • Investments in physical gold	Investors understand that their principal will be at High Risk
Quantum Gold Savings Fund An Open Ended Fund of Fund Scheme Investing in Quantum Gold Fund	• Long term returns • Investments in units of Quantum Gold Fund – Exchange Traded Fund whose underlying investments are in physical gold	Investors understand that their principal will be at High Risk

*Investors should consult their financial advisors if in doubt about whether the product is suitable for them.
The Risk Level of the Scheme in the Risk O Meter is based on the portfolio of the scheme as on September 30, 2022

Above article is authored by Quantum.

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