Why Sensex and Equate Mutual Funds and FDs are no longer beneficial
Asif Iqbal, head of research at Escort Security, told News18 Hindi that whenever the world is scared, whether it is about economic growth or the tension between countries. In such a situation, investors increase their investment in safe investment i.e. gold. Similar situations are visible at the moment.
Asif says that in the 2008 recession, ie between 2008 and 2009, gold gave a return of 42 per cent. Whereas, the Sensex, the major benchmark index of the Indian stock market, had fallen by 52 per cent.In the year 2010 to 2012, when Europe was stuck in debt crisis, gold also increased by 44 percent at that time. However, the Sensex was down 15 per cent.
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Performance of Gold and Sensex in last 15 years
The situation was similar in the year 2013. At that time the currency of the world was falling. At that time, gold had gained 11 percent and the Sensex had weakened by 6 percent. In 2016, gold had climbed 27 percent due to China Yuan crisis. And the Sensex had weakened by 3 per cent. In 2019, the world is moving towards structural slowdown. That is why the gold boom and the stock market are falling.
Now getting only 7.9% profit on FD
If you FD in RBL bank for a period of one year, then at the rate of 7.9 percent, your amount will increase from Rs 10 thousand to Rs 10,814.
At the same time, if you invest money in Lakshmi Vilas Bank's FD, then this amount will increase to Rs 10,798 after the interest received at 7.75%. Let us tell you that apart from this, other banks of the country are now paying interest at the rate of 7 percent.
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Chance to make money in gold
Ajay Kedia, MD of Kedia Commodity told News18 Hindi that there is no possibility of any slowdown in gold prices. Gold prices in Delhi Bullion market can go up to Rs 41,000 per ten grams till Diwali.
Gold prices in Delhi Bullion Market can go up to Rs 41,000 per ten gram in the next few months.
They say that gold has got support due to purchases made in gold by central banks worldwide. In the second quarter of 2019, central banks bought 224.4 tonnes of gold. At the same time, if we look at the figures for the first half of 2019, it is 374.1 tonnes. Apart from this, there has been a tremendous increase in the purchase of ETFs.
How to spend money
You have to open your trading and demat account with any share broker. You can also buy them at regular intervals through Lump-Sum or Systematic Investment Plan (SIP). You can also buy one gram of gold. In this way, instead of giving more time to the market, invest in a systemic way.
Open your trading and demat account with a share broker. Login to the broker's online portal with your login ID and password. Select the gold ETF you want to buy. Place your purchase order for as many UTF units as you want to buy. Money will be deducted from your account. Units will be credited to your demat account on the day of trading or the next day.
Fear of recession worldwide has pushed up gold prices.
Gold prices are rising due to these 5 reasons
(1) Due to the slowdown in the world economy, the trend of investors has shifted towards gold. The International Monetary Fund and the World Bank report forecast global economic growth to fall. That's why investment in gold has increased.
(2) The central bank of the world i.e. the RBI of India has increased the purchase in gold. Many central banks of the world including China, Russia, Turkey increased gold reserves by purchasing gold. According to the report released by the World Gold Council, around 374 metric tonnes of gold is expected to be purchased by central banks across the world in 2019-20. RBI has purchased 60 tonnes of gold since March 2018.
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(3) America has cut interest rates for the first time in the last 11 years. It has been a trend that whenever the US cuts interest rates, gold rates rise.
(4) The world has suffered a major setback due to the trade war between America and China. A situation of stagnation is also being created in world trade. This has especially weakened the currency of Asian countries. For the first time in 11 years, the yuan has reached below seven levels against a dollar.
(5) Tension remains between the US and Iran. Due to which people became interested in gold.
4 big reasons for the decline in the stock market
(1) Fear of recession- Rating agency Crisil has reduced India's GDP from 7.9 per cent to 6.9 per cent. The reason for this is attributed to the slow pace at the global level and weak monsoon at the domestic level. Apart from this, seeing the slow results of the first quarter, India's GDP has been cut.
The production of refinery products has seen sluggishness in the core sector. Also, the report shows that domestic demand has come down, consumer, economy and industrial sectors have slowed down, while non-banking financial sectors have weakened. Apart from this, there has also been a weakness in investment.
(2) Trade war- According to experts, if the trade war between America and China continues, there is a risk of recession worldwide. Vishnu Varathan, head of Asia & Oceania Economics, Japan's Mizuho Bank, says China's weak growth in the April-June quarter could affect the rest of Asia as well. Along with China's exports, the decline in imports is of more concern because, China is the main market for the rest of Asia.
(3) Crisis on the world's second largest economy – China's economic growth rate (GDP) was 6.2% in the April-June quarter. This is the lowest in 27 years. Less than this growth was recorded in the January-March quarter of 1992. In January-March this year, the growth was 6.4%. China's growth rate is declining because of America's trade war. China is the second largest economy in the world.
China's economic growth rate (GDP) was 6.2% in the April-June quarter. This is the lowest in 27 years. (File photo)
(4) Foreign investors angry with the decision of the government – The government has imposed a surcharge on the foreign investor who invested money in the form of foreign portfolio investors (FPIs). Because of this, they are constantly withdrawing money from Indian markets.