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10 Facts about Digital Gold All Serious Investors Should Know

April 21, 2023

Table of Contents

    Table of Contents

      These 10 facts about digital gold will convince you that it is a good investment!

      Is digital gold a good investment? How is investing in digital gold better than traditional gold? How to invest in digital gold?

      If you had these questions in mind for a long time, then changing times and technology have got answers for your questions. With fast paced technology, we have started to earn digitally and have now started to invest digitally as well.

      So many of us have now started to invest in the digital yellow metal to keep agility and diversity in our portfolios. With many advantages of buying digital gold, it’s only obvious that serious investors consider digital gold for so many reasons. 

      Here are the 10 facts about digital gold investment that you should know: 

      1. Digital gold is different from physical gold 

      Digital gold is a form of gold which is stored in a vault, is 24K pure gold that people can buy or sell via various digital platforms. It is accessible anytime, anywhere just with the tap of a button and can be purchased via multiple mobile e-wallets, UPI IDs or bank payments.

      With gold being available in digital form, it has become more safe and functional to use. 

      Whereas, physical gold is majorly bought in the form of jewelry and isn’t considered a smart investment option anymore because it includes a lot of charges like making charges etc which doesn’t make it a profitable asset. Also, it’s not too safe to store physical gold at home.

      Thus, digital gold is clearly advantageous over physical gold. 

      2. Sell Digital gold any time

      Gold in digital format is easier to sell at current market value without incurring any extra fees. The transactional funds are easily transferred to the registered bank account through instant Bank transfer which makes it a very seamless process.

      Gold prices have increased over 300% in the last 10 years because of the metal’s scarcity. It has become an excellent hedge against volatile markets over time.

      As we know the markets are unpredictable at the moment, investing in digital gold is the best way to safeguard oneself from an unstable market. 

      3. Your Investment in Digital Gold is 100% secure

      The digital gold you buy online is allocated as physical gold and is stored in fully certified and insured vaults.

      This vault is protected by additional assurance from IDBI Trusteeship who are there to protect the interests of digital gold investors.

      4. Digital gold a hedge against uncertain markets

      For decades now, gold investments have always been considered a stable investment option. The method to invest in gold has been changing, but the idea of buying and investing in gold is here to stay especially for long-term investors. 

      With so many ups and downs in the market during the pandemic, serious investors are looking at investing in gold even more when digitization of gold buying has made the process convenient and safe.

      Gold has been known as the ideal hedge to guard against inflation. A good time to invest in gold is when the market is going down and inflation is up. Buying jewellery is never considered an investment whereas buying digital gold is a perfect form of investment to protect from volatile markets.

      5. Liquidity Benefits in digital gold

      Digital gold has a huge advantage in terms of ease of liquidating. It can easily be converted to cash any time of the day via your bank account, through a live 24/7 market-linked rate.

      There will also be no deductions like making charges etc. while selling digital gold which is usually the case in physical gold such as jewelry.

      6. The convenience of investing through apps

      With digital gold, it has become extremely convenient to invest online through apps. There are a lot of  MMTC-PAMP partners like GPay, PayTM and PhonePe among others which can make investing in digital gold extremely easy. 

      There are also saving and investment apps like Jar which can help investors auto save and invest in digital gold. It can also invest your spare change in digital gold by rounding off your digital spends for the day.

      7. Flexibility with investment amounts

      There is a lot of flexibility when it comes to the amount you can invest in buying digital gold. It can be as little as ₹10 and can vary based upon your budget. You can invest a small amount of money over time in an asset like gold to be able to develop a stable investment portfolio.

      The price of digital gold is determined by the wholesale market rate, not by other geographical factors making it uniform for all the buyers.

      8. Choose and buy gold in the best form for investment

      Gold can be purchased in various forms such as jewelry, coins, bars, gold biscuits, among others. So, as an investor, you need to be aware of the different forms of gold and their pros and cons.

      If you are buying gold jewelry, then it is NOT an investment idea as there are heavy losses in making charges and wastage. This could vary anything between 10-35% of the value of the gold.

      Bank coins are a slightly better option, but banks charge about 5-10% of the cost of gold as a premium. Also, since banks do not buy back these gold coins, they have less liquidity. Bullion bars are a good way of investment, but here, the amount involved is so high that is it not financially feasible for everyone 

      The ideal way to buy gold as an investment is to buy digital gold. No losses in melting, no fuel cost in commuting to the jeweler, can easily sell for cash whenever you want. 

      9. Get doorstep delivery of 24K pure gold

      If you want gold in its physical form, you can redeem your digital gold for physical units at any given time. Even when it’s difficult to go out, you have to just tap on some buttons on your phone apps and you will get the collection of highest purity gold bars or coins delivered to your doorstep safely.

      10. Digital gold can be used as collateral for loans 

      As an investor, you must know that you can take out a loan against the digital gold you own. This can be useful for someone who has been accumulating digital gold and now needs a loan to maybe start a business or for anything else.

      Considering all of the above facts, investing in digital gold looks to be a beneficial idea. As the average age of the investors keeps changing, so will their way of investing change. In the digital space, trusting and investing in familiar and trusted instruments such as digital gold to build long term wealth is a smarter and safer move.