Gold ETFs: A gold exchange-traded fund is a mutual fund that is commodity-based, and invests in commodities such as gold. This is one of the most popular options as far as how to buy digital gold goes. Let’s take a look at how this works.
A gold ETF functions similarly to a traditional mutual fund, which can be traded on the stock market. The only differing factor is that instead of the fund’s investments lying in stock, they are in commodities, in this case, gold. As a result, the ETF stands as a representation for the commodity, both in dematerialized and paper form. When you invest in the gold ETF, you are investing in the stock of the fund instead of the gold itself. And once trade takes place, you are credited with the value of the gold in cash, instead of with the commodity itself. This eliminates the requirement for individuals to liquidate their assets if they are holding them in traditional gold.
SGBs: Sovereign Gold Bonds or SGBs are government securities that are denominated in the price of gold in grams. While looking at how to buy gold, one could consider SGBs as they are government-issued. This type of gold investment allows investors to invest in bonds, with the minimum investment requirement being 1 gram, and the maximum limit being 4 kgs per annum per investor. This stands to be another strong option while considering how to invest in gold online.
Gold Mutual Funds: While considering how to buy digital gold online, we previously discussed gold ETFs. Gold mutual funds, on the other hand, are open-ended funds that invest in gold ETFs. This is also a good option while considering how to buy gold, as it also allows investors to invest in the companies mining the gold, both within the country and abroad.
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