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Create a gold portfolio; make money
In the last two months, DSP World Gold Fund has delivered an astounding 62 per cent returns. This is exceptional, since ETFs and physical gold barely delivered around 17 per cent during the same period. Even AIG World Gold Fund managed to deliver a handsome 42 per cent absolute return.
These gains were primarily due to the fantastic recovery of gold mining stocks. Some of these stocks have delivered returns in the range of 50-65 per cent.
So considering that there are so many choices within the gold asset class, here's an example of how to create a gold portfolio. (This is just an indicative structure and it could vary from person-to-person.)
INVESTMENT STRATEGY
50 per cent in ETFs.
40 per cent in funds of gold mining companies.
10 per cent in physical gold
Jewellery is considered a personal asset and not an investment and hence should be excluded. However, if you were to include jewellery in your portfolio, then 30-40 per cent can go in jewellery, 40 per cent in ETFs and 20-30 per cent in equities.
The author is director, My Financial Advisor.
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