Its common knowledge that Indians are crazy for Gold. And other metals. And precious stones. I guess its the most commonly known trait about Indians. What could the reason be.
Other Investment options
I mean why dont' Indians invest in stocks (still a very small fraction of the population), FDs, SIPs/Mutual Funds, Real Estate,etc. actually real Estate is quite popular and must follow bullion a close second.
There are a few reasons I think that Indians love investing in Indian Gold coins over other avenues.
1) Historical
Since we are a very old civilization we tend to value precious metal over paper currency or new fangled financial instruments. Since the times of Kings and Emperors, we have always fancied Gold, no correct that hoarded Gold. It was easy to take value of, to trade (globally accepted), to use as jewelery. Hence over the centuries we have had it used as a measure of prosperity and as a article to barter. Remember the massive treasure trove in the Padmanabhaswamy Temple in Kerala which was stashed away by the last king of the land? The El Dorado of India.
2) Touch and feel
Indians always like to see what they are getting for their money so to speak. So cold FDs, Stocks, Mutual Funds don't excite them as hard gold (even cash), or real estate (where the first thing they do is put a fencing around it with a Board proclaiming their rights).
3) Kaala paisa??
This is an obvious and simple reason for some Indians to invest in Gold and cash. No accountability and no paperwork. Simple enough?
4) Beti ke liye
This is as filmi as it gets. But in the rural areas where education levels are low, Gold is a safe and something everyone understands well. It makes sense for parents to save in Gold and then use it for jewellery and other expenses for their daughters wedding.
Other Investment options
I mean why dont' Indians invest in stocks (still a very small fraction of the population), FDs, SIPs/Mutual Funds, Real Estate,etc. actually real Estate is quite popular and must follow bullion a close second.
There are a few reasons I think that Indians love investing in Indian Gold coins over other avenues.
1) Historical
Since we are a very old civilization we tend to value precious metal over paper currency or new fangled financial instruments. Since the times of Kings and Emperors, we have always fancied Gold, no correct that hoarded Gold. It was easy to take value of, to trade (globally accepted), to use as jewelery. Hence over the centuries we have had it used as a measure of prosperity and as a article to barter. Remember the massive treasure trove in the Padmanabhaswamy Temple in Kerala which was stashed away by the last king of the land? The El Dorado of India.
2) Touch and feel
Indians always like to see what they are getting for their money so to speak. So cold FDs, Stocks, Mutual Funds don't excite them as hard gold (even cash), or real estate (where the first thing they do is put a fencing around it with a Board proclaiming their rights).
3) Kaala paisa??
This is an obvious and simple reason for some Indians to invest in Gold and cash. No accountability and no paperwork. Simple enough?
4) Beti ke liye
This is as filmi as it gets. But in the rural areas where education levels are low, Gold is a safe and something everyone understands well. It makes sense for parents to save in Gold and then use it for jewellery and other expenses for their daughters wedding.
Good post but can you please tell me where should I invest my money?
ReplyDeleteI wanted to invest in Bajaj FD Scheme because they are giving good interest rate.
Can you please check the same for me & provide your useful suggestions (link shared with you)
Also checker their FD Rates .