Today one can buy gold from various places like a family jeweller, branded jeweller, banks even postoffice. Therefore knowing where to buy gold becomes crucial. As these key findings by rediff.com is a real eye opener.
What and where to buy more of the yellow metal?1) Gold bars/coins should be purchased with reputed jewellers and not banks. A lot of banks like ICICI bank, HDFC bank have started selling gold bars. But hold on! Is it really worth buying from the banks? A survey by rediff.com shows that buying gold from banks can be really expensive as compared to a traditional jeweller. They have also taken a branded retailer into consideration to rest all doubts. Even though this survey is old to quote in blog post so do double check your prices before you commit that purchase.
Expensive, for sure
| Bank
(Private) | Branded
Retailer | Jeweller |
| Purity | 0.999 | 0.999 | 0.999 |
| Price per kilo* (Rs) | 1,071,520 | 1,025,000 | 940,000 |
| % Discount to Pvt Bank Rate | NM | 4.5% | 14.0% |
* Prices as on 8th of November 2006; Including VAT
NM - Not MeaningfulFrom the table its evident that there is a substantial loss of value( close to 14%) when buying gold from banks as compared to traditional jewellers.
Another bummer with banks is that
RBI does not allow banks to purchase gold back from customers. Gold brought from banks can be sold to jewellery shops though.
Banks lose out| Gold Bar | Bank
(Private) | Branded
Retailer | Jeweller |
| Buy back facility | No | Yes | Yes |
| Discount on buy back | NA | NIL | NIL |
2)Gold funds are preferred over jewellery because no value is lost as making/design charges.
Another reason to go for gold funds is the storage problem with physical gold. With paper gold you can still make the gain without having to worry about finding a safe haven for your physical gold.
(This article has been republished from a previous article as the title of the previous article didnt do justice to the content. Hence the need to republish it)
