Gold is among one of the essential commodities today in the world. In some cultures, like India, it also exhibits its auspicious significance. If you look at earlier times, you will get to know that it was a signifier of social status and a person’s worth in society. Having great value, people tend to incline towards gold investment frequently.
The investors in Singapore can buy assets and they help in the generation of stocks and passive income. The prices of gold, however, do not fluctuate much when compared to other assets in stock. Moreover, it is easy to buy from a trusted jeweler and nowadays even gold loans are available.
What are the risks involved in gold investments?
With various benefits, gold investments in Singapore also have some limitations attached to them. These are mentioned below.
- Security Concerns
Since gold jewelry holds a great level of value and is sold at high prices, it is more prone to theft. Physical assets will always raise security concerns around you. However, being an investor you need to find ways to invest in it. Therefore, you can opt for digital gold that offers the same benefits as physical gold. In this process, for each gram purchase of gold, the same quantity of physical gold is backed up and secured.
- Storage Issues
You might be aware of the fact that storing gold in physical form has always been an issue everywhere. You may require a safe to store and will always stay unsure about its safety. The thoughts of theft will always rule your mind. Hence, it is necessary to find a solution. An approach towards digital gold is appreciated as it gets stored in a safe and secure vault.
- Making Charges
If you ever visit a known gold investment firm in Singapore, you will get to know there are several commission issues associated with gold. This increases the overall cost of purchase and you might even be required to pay for selling. To resolve these issues, the gold ETFs invest in gold bullion and can be bought and sold like shares. The ETFs carry a low expense.
- No passive income
Physical gold investments do not lead to passive income like mutual funds, stocks, and P2P lending. The only way to earn profit through physical gold assets is by selling them. On the other hand, the digital approach is beneficial if you are looking to supplement your income through investments.
- Purity Concerns
The value of gold is because of its purity that is measured in the unit ‘Carat’ (K). The purest form of gold is available as 24K and needs to be secured. To trust with purity, you need to buy it from a trusted source of manufacturer or seller who holds years of expertise in this field.
Before investing in gold in Singapore, you must look at the possible benefits and risks involved in it. Your decision should not be taken in a hurry. Research the subject and then conclude.
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