Gold is an asset that has fascinated Indians for centuries. Indians use gold in all forms, like ornaments, coins and biscuits. Gold has a unique, indestructible structure, which never loses its value. With the world shifting rapidly towards digitisation, gold is also becoming popular in its digital form. Investors can easily find the gold selling price today and can sell their digital gold online.
Digital gold has as an additional layer of security. Physical gold is considered as a ‘store of value’. Here is everything you need to know about the benefits of investing in digital and physical gold.
Digital gold is an alternative to physical gold that you can buy from various websites and mobile applications. An investor can know the gold selling price today on various websites and can invest in 24K gold that offers 99.9% purity.
Physical gold investment is how you usually buy gold as an investor for consumption or trading. It can be in the form of coins, biscuits, ornaments, or gift items. Investors can buy physical gold directly from a jeweller to eliminate the counterparty risk.
|Parameters||Physical Gold||Digital Gold|
|Meaning||Physical gold’s purity may or may not be 99.5%.||Purity is guaranteed.|
|Price||Physical gold prices are not uniform.||Digital gold prices are uniform across the country.|
|Investment||Gold biscuits or coins are available in the standard denominations of 10 grams. Hence, it requires a huge investment||One can buy and sell gold by weight or by fixed worth.|
|Storage||One has to safely store the gold in a locker or at their home.||The seller stores the digital gold in the investor’s name in a secure locker|
|Taxation||Gains from a gold investment held for less than three years are taxable as per the investor’s income tax slab rates. For an investment withholding period of more than three years, the gains are taxable at 20% with indexation benefit.||Gains from gold investments held for less than three years are taxable as per the investor’s income tax slab rates. For an investment withholding period of more than three years, the gains are taxable at 20% with indexation benefit.|
|Liquidity||One can easily buy physical gold from any bank or jeweller. However, they can be exchanged through a jeweller.||One can redeem digital gold as coins and bullion or cash out the investment.|
The Final Word
Both digital and physical gold have their advantages and disadvantages. An investor can decide between the two based on their investment needs