Richard Russel, an American finance writer, said, “Gold will be around; gold will be money when the dollar and the euro and the yuan and the ringgit are mere memories.”
Gold as an asset is a habit that is deeply ingrained among Indians. As gifts, especially at weddings or as an investment asset, gold is the most trusted, especially among the older generations. It is also considered auspicious across the country.
Historically, gold was used as currency and followed the ‘Gold Standard’; in contrast, today, it’s an asset. The Reserve Bank of India can print currency by the Minimum Reserve System, which is an x amount of gold coins, gold bullion and foreign currency.
Here, we look at gold as an investment opportunity. We also answer the query about ‘today’s gold rate in Chennai’ and more.
The Current Scenario of Gold Investments in Chennai
A recent study by Axis My India found that 36% of people in Tier-1 cities buy gold for investment rather than as jewellery. Women tend to invest more in gold, with 65% of women investing in gold compared to 41% of men. Chennai is a Tier 1 city, and gold is still a trusted investment choice.
In Chennai, gold is a highly sought-after commodity due to the heavy focus on festivals and culture. It is one of India’s most prominent cities for gold trading. It is also regarded as the number 1 city to invest in gold in India.
Today’s Gold Rate in Chennai
Here are the gold rates for the past 10 days. 24k gold rate in Chennai is different from the gold rate today in Chennai 22k. You can also find 1 gram gold rate today in Chennai here:
| Date | Pure (24k) 1 gm | Pure (24k) 10 gm | Pure (22k) 1 gm | Pure (22k) 10 gm | Change in percentage |
|---|
What are the Different Ways to Invest in Gold?
When investing in gold in India, multiple options are available, each with its advantages and disadvantages. Let’s take a look at some of the most common methods:
1. Physical Gold
This method involves buying gold as jewellery, coins, or bars from a dealer. While selling or exchanging physical gold is easy, additional costs include making charges, storage expenses, and potential purity issues.
2. Gold Exchange Traded Funds (ETFs)
Gold ETFs are investment funds that track the price of gold and can be traded on stock exchanges. This allows investors to gain exposure to gold prices without owning physical gold. The expenses associated with gold ETFs are typically lower than those of physical gold, but a Demat account is required to invest in them.
3. Sovereign Gold Bonds
These are government-issued bonds that are denominated in grams of gold. Investors can purchase these bonds during the issuance period and earn an interest rate of 2.5% per annum. No GST or wealth tax is applicable on these bonds, but there is a lock-in period of 5 years, and premature redemption is allowed only after the 5th year.
4. Gold Futures
Gold futures are contracts to buy or sell gold at a predetermined price and date in the future. They are traded on commodity exchanges, allowing investors to take a leveraged position on gold. However, trading in futures requires expertise, and the risks involved are higher than in other forms of gold investment.
5. Gold Mutual Funds
These mutual funds invest in stocks of companies engaged in gold mining, refining, or other activities related to gold. Gold mutual funds offer diversification benefits, and the risks involved are lower than trading in futures. However, the returns from these funds are correlated to the stock market’s performance.
In summary, it’s essential to weigh the pros and cons of each method and choose the one that aligns with your investment objectives and risk tolerance.
Today’s Gold Rate in Chennai: What Factors Influence the Price of Gold?
The Indian Bullion Association is in charge of determining the gold rate and purity of the metal. Any dealer selling gold is required to display a hallmark symbol indicating its purity. For instance, 22K916 signifies that the gold used is 22-karat and has 91.6% pure gold content, while 18K750 represents 18-karat gold that contains 75% pure gold. Similarly, 14K585 denotes 14-karat gold that comprises 58.5% pure gold.
Today’s gold rate in Chennai and other cities is affected by what’s happening in the global stock market. Since India doesn’t mine its gold, we don’t have to worry too much about fluctuations in the market. However, external factors can still affect the purchasing power of importers and the public in general.
There are majorly two different kinds of factors that affect the gold rate in Chennai live – long-term and short-term aspects. Here’s a quick overview regarding the same:
- Economic and political conditions globally: In times of uncertainty, gold is often viewed as a safe investment, which can increase its demand and cause the price to rise.
- Interest rates: When interest rates go up, investors may choose to put their money into other investments that offer a higher return, resulting in a decrease in demand for gold.
- Currency exchange rates: Fluctuations in the exchange rate between the US dollar and other currencies can impact the price of gold since it is priced in US dollars.
- Inflation: High inflation levels can lead to an increase in demand for gold, as it is often used as a hedge against inflation.
- Central bank policies: Changes in interest rates or other policies enacted by central banks can impact the price of gold.
- Supply and demand: Changes in the supply of and demand for gold can also impact its price, such as an oversupply of gold due to increased mining production.
- Investor sentiment: Investors’ outlook towards gold can also affect its price, with positive sentiment driving prices up and negative sentiment causing prices to drop.
A Brief About Taxation on Gold
Gold in India is subject to various taxes depending on the form and purpose of acquisition. The following are some of the common taxes applicable to gold:
1. Goods and Services Tax (GST)
A 3% GST is applicable when gold is purchased in any form except jewellery. On the other hand, gold jewellery is subject to a higher GST rate of 5%. This is because of the difference between gold as a product and gold jewellery-making as a service. But as per Section 8 of the CGST Act, selling gold ornaments or jewellery is a mix of supply of goods and services. If the principal supply is the sale of gold as ‘goods’, then the GST rate of 3% is levied, and 5% would be applicable on the making charges.
2. Capital Gains Tax
If physical gold, including jewellery, coins, or bars, is sold for a profit, it is considered a capital gain and is subject to capital gains tax. The tax rate varies depending on the duration the gold was held before selling.
3. Wealth Tax
Gold, among other assets, is subject to wealth tax if its value exceeds ₹30 lakhs.
4. Customs Duty
Imported gold in India is subject to custom duty, and the current customs duty rate for gold is 12.5%.
You must note that tax laws are subject to change, and consulting a tax professional for guidance on tax-related matters is recommended.
Alternative Investments Options
There are many options when it comes to investment opportunities in India. While real estate is popular, it might not be the best choice, especially in Tier 1 cities, as many properties have reached their price saturation. Other than gold and real estate, here are some other investment options you can choose from:
- Mutual funds
- Government bonds
- Invoice discounting
- Term deposits or recurring deposits
- Direct business investments
- Stocks
- Public Provident Fund
- National Pension Scheme
Do your research and invest at your discretion.
Conclusion
Do thorough research before you look for today’s gold rate in Chennai and invest in gold. It is wise to buy when the prices are low, but you can also think of buying gold as a SIP — a little bit every month. If you invest in the Sovereign Gold Bond, you can also get a pre-decided amount of interest every year.
If you have more questions about gold or today’s gold rate in Chennai, browse our FAQs below. Always remember to check the live Chennai gold price before buying.
FAQs
Q. What are the taxes applicable on gold in Chennai?
1 gram gold rate today in Chennai is ₹6110 for pure 24k gold and ₹5560 for 22k gold.
Any dealer selling gold is required to display a hallmark symbol indicating its purity. For instance, 22K916 signifies that the gold used is 22-karat and has 91.6% pure gold content, while 18K750 represents 18-karat gold that contains 75% pure gold. Please check for this on the gold bar/gold ornament that you purchase.
On the rate of gold live Chennai, 3% GST applies to gold as a ‘good’ and 5% GST on the making charges.
One ‘tola’ (an ancient unit of gold still widely used) equals 10 grams of gold.
You can find gold in many colours in Chennai; white gold and yellow gold are the most popular. Another popular variant is rose gold. You can also find black gold.
Disclaimer
This article is solely for educational purposes. Stable Money doesn't take any responsibility for the information or claims made in the blog.
