Should you invest in gold now?
Shifting preferences

The rally in the equity markets that started in August/September 2013 has seen the benchmark indices - the S&P Sensex and the CNX Nifty - move up over 35% till now and has seen investor preferences shift to riskier assets like equities.

In contrast, gold and silver, considered safe haven bets in uncertain times, lost 8.8% and 20.4%, respectively during this period. Consumer demand (in monetary terms) for jewellery, gold bars and coins dipped 41% in the first quarter of calendar year 2014 (Q1 2014) to $7,911 million. In physical terms, it was 26% lower at 190.3 tonnes, data suggests.

All this, in effect, also reflects the investor's preferred investment choice at a time when the country was gearing up to vote and elect a new government.

Also Read: Gold gives lowest returns in 17 years

Text: Puneet Wadhwa, Business Standard

Images Courtesy: AP
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