Gold and silver prices once again moved higher on Tuesday after a sharp fall witnessed on Monday. Gold futures traded up nearly 1 per cent at Rs 50,219 per 10 gram, while silver futures climbed 2 per cent to Rs 62,116 per kg.
American drug manufacturer Pfizer reporting promising results for its COVID-19 vaccine on Monday resulted in a crash in precious metal prices across the globe. Gold prices were down by Rs 2,500 per 10 gram while silver slumped by 4,600 per kg.
Market observers said, though there are claims by drug manufacturers that they have attained a great amount of success with the vaccine, it will take some more time to quell the uncertainty that is prevailing in the financial market, including precious metals.
In a volatile time, if one wishes to buy precious metals, particularly with Dhanteras just round the corner, what are the things one should keep in mind? We spoke to a few experts.
Ketan Kothari, Director, Augmont, an online trading platform for gold, silver coins, and bars, said, "The demand for gold strengthens in India in the fourth quarter of the year due to wedding season and festivals like Dussehra, Dhanteras and Diwali. During this period buying gold is considered auspicious. If someone is planning to buy gold jewellery then look for BIS Hallmarking for checking purity and fineness, whether it is 22 carat (KT), 18 KT and 14 KT.
Hallmark is the stamp of purity provided by the Bureau of Industrial Standard (BIS), a Government of India (GoI) undertaking.
Carat is the unit that measures the purity of the precious metal. The higher the metal measure, the more is the purity. No jewellery can be made out of 24 KT pure gold. Jewellery makers have to mix certain other metals like copper, brass with gold to make ornaments.
Ahammed MP, Chairman, Malabar Gold & Diamonds, said, “The first and foremost precaution that a gold jewellery buyer must adopt is to insist on BIS Hallmarked jewellery, as it denotes the purity level of gold.”
Kothari said, “Many people prefer to buy gold coins over jewellery as coins can be bought in denominations of 0.5 grams. Look for tamper-proof packing guard against counterfeiting and fraud.”
Coins don’t involve making charges, unlike jewellery. The purity of the metal remains intact and when you want to sell it or exchange it against ready-made jewellery, you don’t have to bother about the charges that will be deducted for metals mixed. These charges are called “Ghat” in the market parlance.
Ahammed said, “The buyer must verify the weight of the jewellery with a proper weighing machine available at the store. The buyer can calculate the making charges as per the weight to ensure that the charges are authentic. The buyer needs to check the return and buyback policy of the jeweller beforehand.”
Buying gold digitally through Gold ETF or Sovereign Gold Bond (SGB) is also a good option, with additional benefits of liquidity and security as compared to physical gold, said Kothari.
The buyer needs to ask for the bill, which specifically mentions the gold rate per gram, total weight, total price, making charges, and GST. One should buy jewellery from an authentic and reputed store, Ahammed concluded.