Gold Bonds

You're asking the right questions! SGBs are great because the profit is tax-free at the end, and you also receive yearly interest. This often makes them better than gold ETFs for the long run. The only catch is that they aren't as easy to sell quickly if you need cash fast. If you're okay with locking your money in, the tax savings are worth it. Stick with ETFs for more flexibility.

If you’re considering gold, Sovereign Gold Bonds (SGBs) are probably your best bet for the long run. They’re safe, pay you 2.5% interest, and are tax-free if you hold them until they mature.

If you want something easy to buy and sell at any time, go for Gold ETFs. Physical gold is nice to hold, but the additional GST and making charges make it somewhat more expensive as a pure investment.

The gold and silver market is very volatile, so diversifying bonds is a very good idea for risk reduction, but over-diversifying can reduce fixed income stability and will increase complexity. Before investing, keep these things in mind:

Bonds offer a fixed interest rate, but gold and silver won't (unless you invest in SGBs).

Gold is still a safe option, but silver's price fluctuates a lot because of industrial demands. This all will create more price fluctuations in your overall portfolio.

When you sell gold and silver, there is a capital gains tax, which is different from the bond taxation system.

If your primary goal is stability and income, then you should rethink investing this much in gold and silver. I suggest you invest in Sovereign Gold Bonds (SGBs) as they are more tax-efficient.

As a long-term investment in gold, SGBs are very beneficial, as they offer a fixed interest rate of 2.5% annually, and tax-free capital gains are at maturity (after 8 years), which is anyway a better option than physical gold.

SGBAnalyzer's alerts are actually very useful for tracking discounts, premiums, price fluctuations, volatile market trends, and many more.

For so many, SGBs have proven to be a beneficial investments. This is a long run investment, and they give a consistent return and good protection against inflation. You can combine SGBs as a part of a diversified portfolio.

I have not invested in SGBs yet, but I would invest a moderate portion, around 10% of my investment portfolio.