Is Akshaya Tritiya Really the Best Day to Buy Gold?

December 31 , 1969

Last year by this time of the year the gold price had fallen significantly. But this year it has been consistently in the range around 28,400 in January and now we are at 28,970s now(except for some period in mid March when the price crossed 30,000).  TV news channels and websites are teeming with analysts' predictions. Some are swearing now is the best opportunity to buy gold while others think the decline is expected; or it will be back climbing soon.

So is now the best time to buy gold or not? The answer totally depends on what you're buying gold for.

Gold for jewelry-you have a yes! 

If you had been waiting all these months praying for gold prices to soften so you can buy that piece of jewelry. Walk to the showroom and get your gold jewelry now. There's no need to time gold purchase if it is meant for consumption. It is just like you don't wait for the best times of the year to buy a TV or fridge. You buy it when you need it or have the money to buy it.

Akshaya Tritiya's round the corner. Should you consider buying it on this day? Well, most likely gold price gets a little higher on days around Akshaya Tritiya and Dhanteras since people will be flocking showrooms. So if you hold it just a little longer, a few days or a week, you might be able to get your piece at a better price.

Gold as investment- go easy… 

Things are a little different here. You don't need to jump at the chance now. Gold prices might fall further in the months to come. But nobody knows for sure. So it is best to spread out investment over time and buy little by little regularly.

It will be helpful to understand why gold prices are falling now. All these years gold had a gala time, especially in the last 5 years with global economies struggling. World over investors rushed to gold because it was perceived as a safer place to be in. Now that economies are recovering, particularly the US economy, they are dumping their gold reserves. The recent decline is perhaps part of that correction and as we expect economies to continue on their recovery path gold prices are likely to fall further.

So what should you do? Keep your exposure to gold to a modest 12-15% of your investment portfolio. It is not wise to shy away from it either because historically gold prices have stayed over long term inflation rate. Invest in gold regularly and in just the right amount through a gold ETF or if you do not have a demat account then through a gold mutual fund.