22 Karat or 24 Karat Gold?
The basic ideology behind purchasing precious metals is preserving wealth, followed by diversification in an investment portfolio and lastly looking for returns over a long period of time. Gold has proven be a very safe haven asset hence India is a leading consumer of Gold. Let the gold be in the form of paper assets such as ETF’s or bonds, and physical metals in the form of jewellery and bullions such as coins and bars.There are pros and cons to both paper assets and physical assets but the main advantage that physical metals occupy over paper is that the ability to hold the metal under your own supervision which is not preserved by any risks which come along the uncertainties of the economic conditions. The freedom to buy and sell is a key advantage as well.Gold being readily available in the market as jewellery and bullion is an advantage over paper assets.
Jewellery is made out of 22 karat gold which is 22 parts pure of 24 parts, which comes to 916 fineness or 91.6 % pure. There might be many designs available but there are cons which can highly influence your purchase. Making charges for jewellery is very high and returns are narrowed if sold in a hurry.
How is the rate of Gold jewellery calculated?
Rate of gold + Hallmarking charges + Jewelry Making charges (11-15%) + GST = Total Cost
On the other hand, Bullion in the form of coins and bars are also available in 22 karat but it does not stop here, you can easily find gold bullion in 24 karat gold which is considered the purest form available to mankind. Gold coins and bars of 24 Karat purity come in various fineness, 995 Gold which is 99.50 % pure, 999 Gold which is 99.9 % pure and 9999 Gold which is 99.99% pure.
How is the rate of Gold bullion calculated?
Rate of gold + Making / Packing / Assay Certificate / Minting / Delivery / Insurance charges (4-5%) + GST = Total Cost
The advantage of buying bullion can be reflected here, the purity is one of the concerns with jewellery but bullion eliminates that concern. The making charges on bullion is low as compared to jewellery hence in case of an emergency, selling coins and bars will give a better return.You can buy 22 Karat Gold coins and bars as per your requirement, but CoinBazaar suggests 24 Karat Gold coins and bars for a better ROI.
22 Karat Gold Coins
24 Karat Gold Coins