Invest in Gold

Why should I invest in gold when I have other options like fixed deposit?

Do see the below chart

Value in 2005


24K Gold = Rs 20000 ( 1 Ounce price)

Fixed deposit in Bank = Rs 20000 ( 8% Interest)


Value in 2010


24K Gold = Rs 56500 ( 1 Ounce price)

Fixed deposit in Bank = Rs 28000 ( 8% Interest)


Tail piece:

Y2008 – 1 Gm = 1290 (24 Carat)
= 1199 (22 Carat)




What is the approximate growth of gold rate per year?
Approximate 20% (Refer Y2005 – Y2010)



Why should I buy gold coins instead of gold jewels?
When you sell gold jewels, deprecations amount will be applicable. But coins are taken by market rate.



Where can I get gold coins?
All most all nationalized banks in India and Some Private banks.



What is the difference in private jewelers and bank’s gold coin?
Gold Purity.



What is the assurance for purity when I get gold coin from bank?
Swiss made with Assay Certification
24 Karat, 999.9% purity gold.
Bank logo
Packed in tamper proof





Will Bank of XYZ buy back the gold sold by them?
Bank of XYX does not buy gold coins sold by them. You can sell it to any jeweller.




are there any banks having URL to check the current gold price?
Yes, do find the list

statebankofindia

bankofindia.com

unionbankofindia.co.in

bankofbaroda.com

Gold Price History in India

Known and Unknown Information about Gold

A Brief History Of Gold

• Gold was first discovered as shining, yellow nuggets. "Gold is where you find it," so the saying goes, and gold was first discovered in its natural state, in streams all over the world.

• Gold became a part of every human culture. Its brilliance, natural beauty, and luster, and its great malleability and resistance to tarnish made it enjoyable to work and play with.

• Gold was the first metal widely known to our species. Gold has always been powerful stuff.

• Gold, beauty, and power have always gone together. Gold in ancient times was made into shrines and idols ("the Golden Calf"), plates, cups, vases and vessels of all kinds, and of course, jewelry for personal adornment.

• Gold has always had value to humans, even before it was money. Prospecting for gold was a worldwide effort going back thousands of years, even before the first money in the form of gold coins appeared about 700 B.C.

Fixing Price for Gold

• The first Gold Fixing took place On the 12th September 1919 at 11.00am.

• The original five founding members were: N M Rothschild & Sons; Mocatta & Goldsmid; Samuel Montagu & Co.; Pixley & Abell; and Sharps & Wilkins.

• For over 80 years we have been fixing the price of gold providing market users with the opportunity to buy and sell gold at a single quoted price. It also provides a published benchmark price that is widely used as a pricing medium by producers, consumers, investors and central banks.

• The fix is carried out twice a day by the 5 members via a dedicated conference call facility.

• At the start of each fixing, the Chairman announces an opening price to the other 4 members who relay this price to their customers, and based on orders received from them, instruct their representatives to declare themselves as buyers or sellers at that price. Provided there are both buyers and sellers at that price, members are then asked to state the number of bars they wish to trade.

• The Chairman then announces that the price is fixed. It should be noted that the Fix is said to balance if the buy amount and the sell amount are within 50 bars of each other. The Fixing will last as long as it is necessary to establish a price that satisfies both buyers and sellers.

• To ensure that the price is not fixed before the member has had an opportunity to communicate any changes each member has a verbal flag. As long as any flag is raised, the Chairman may not declare the price fixed.

London Gold Fixing

The price of gold is fixed twice daily in London by the five members of the London gold pool, all members of the London Bullion Market Association. The fixes start at 10.30 a.m., and 3.00 p.m. London time. The length of time taken to reach an agreed fixing price can vary. Nowadays it is often reached in minutes, but we have known in take several hours on at least one occasion. There are a number of common misconceptions about the London gold fix.

Three Currencies

Many people, including most of the media, are under the impression that the gold price is fixed in US dollars. It is actually fixed in pounds sterling (GBP), and Euros also, although the Euro pricing is fairly new.

Types of Gold

• The difference between the different types of gold is in the purity of the gold.

• The karat weight of gold is measured by a gold’s purity.

• With 24 karat gold being pure gold.

• 22 karat gold would have a purity of 22/24 or 91.7 percent.

• 18 karat gold would have a purity of 18/24 or 75 percent.

• 14 karat gold would have a purity of 14/24 or 50 percent.

• 10 karat gold would have a purity of 10/24 or 41.6 percent.

• As the purity of gold decreases, the alloy in the jewelry increases.

• Copper and silver are the most common alloys used when making gold jewelry and white gold is usually made with a nickel alloy.

• The higher karat weight a gold piece of jewelry has, the more valuable that piece of jewelry will be.

Gold Measuring

Gold measuring is usually done from 2 points of view:

• Purity and

• Weight

Purity

The purity of gold articles may be described in three ways:

• Karat=> meaning parts of gold per 24.

• Percent=> meaning parts of gold per 100 .

• Fineness=> meaning parts of gold per 1,000 (European System).

Weight
The most widely known and used measure unit for gold is the troy ounce.

• A troy ounce (480 grains) is 31.1034768 grams.

There are many other types of weight systems:

• Grams and kilograms (metric system) , tolas , teals and baht.