# Is It the Right Time to Buy Gold in India? (2026) Gold hit records, then fell. Why it rallies, how much to own (5-10%), the best ways to buy it after SGBs stopped, and why jewellery is a poor investment. By Nikhil Varghese, CA · 22 October 2025 · https://finniki.com/blog/should-you-buy-gold-now **Quick answer:** Buy gold for **protection, not profit**. It tends to rise when the world is frightened and cool off when confidence returns, so no one can time it reliably. Hold about **5 to 10% of your portfolio** in gold and build it gradually, mainly through **gold ETFs or gold mutual funds**; buy hallmarked coins or bars if you want physical gold, and treat jewellery as emotion, not investment. Gold passed ₹1.5 lakh per 10 grams in 2026 before falling back to about **₹1.44 lakh** by late October, a reminder that it can drop 5 to 20% even in a long uptrend. *Updated October 2026. When the episode was recorded in October 2025, gold had just crossed ₹1.25 lakh per 10 grams. Since then: the government has stopped issuing new **Sovereign Gold Bonds** (no new tranche since February 2024), and in November 2025 **SEBI warned** that "digital gold" sold on apps is not regulated by SEBI and carries no investor protection.* [Watch the episode: Is this the right time to buy gold? Should you buy or wait?](https://youtu.be/UTAmabBea88) ## Why did gold prices rise so much? Three forces drove the rally of 2025 and 2026: 1. **Fear and uncertainty.** War in Ukraine, conflict in the Middle East and worries about the US economy push investors away from shares and paper currencies towards the asset that has held value for thousands of years. 2. **Central banks buying.** Central banks bought over **1,000 tonnes** of gold in 2023 and kept buying heavily after, as countries such as China, Turkey and India reduce their reliance on the US dollar. When the biggest buyers want something, its price rises. 3. **Low real returns elsewhere.** An FD paying 7% with inflation at 6% leaves a real gain of about 1%. Gold has protected buying power better in such periods. In India, a weaker rupee also lifts gold prices, because gold is priced in dollars: even when the global price is flat, a falling rupee makes gold dearer here. Silver rallied alongside gold. ## Does gold always go up in a crisis? It usually rises in a crisis and cools afterwards. After the 2008 financial crisis, gold roughly **doubled** over the next three years. In 2020, during COVID, it hit record highs again. But once fear fades, money moves back to shares and businesses that can grow faster. After peaking at about **₹32,950 per 10 grams in November 2012**, gold fell nearly **30%** over the next few years as markets stabilised. Gold is cyclical: it rises when fear dominates and cools when optimism returns. ![After peaking at about ₹32,950 per 10 grams in November 2012, gold fell nearly 30% over the next few years.](https://finniki.com/blog/media/bf6f54b7801d9efff38dd4ed.jpg) ## Is it too late to buy gold now? Not if you buy it for the right reason. Gold is not a multibagger; it is a **seatbelt**, not a sports car. Like health insurance, you own it for protection, not profit: it keeps you from getting poorer when shares fall, inflation bites or the rupee slides. - **Buy** if you want diversification and long-term protection. - **Do not buy** expecting it to double in a year, or as a replacement for your equity investments. Since nobody can time gold, do not try to catch the bottom. Build your holding gradually, for example with a monthly investment in a gold fund, so you are not betting on one price. ## How much gold should you own? About **5 to 10%** of your portfolio. Less gives little protection; more holds back long-term growth, because gold pays no interest or dividends. ![Hold about 5 to 10% of your portfolio in gold, built gradually.](https://finniki.com/blog/media/4885c3e2142c52b27dccad39.jpg) ## What is the best way to invest in gold in India? From most to least practical: 1. **Gold ETFs.** Buy units on the stock exchange through a demat account, just like shares. No locker, no making charges, no purity worries, and you can sell any trading day. Without a demat account, a **gold mutual fund** (a fund that invests in gold ETFs) gives the same exposure and lets you invest by SIP. 2. **Physical coins or bars.** If you want gold in hand, buy **BIS-hallmarked** coins or bars, not jewellery. 3. **Jewellery.** Fine for weddings and tradition, poor as an investment: making charges, GST and purity issues can cost **8 to 10%**, so a 15% rise in gold may leave you only 7 to 8% better off. Two options to treat with care: - **Digital gold** on payment apps lets you buy gold for as little as ₹100, held in a vault for you. But SEBI has warned that it is **not regulated** by SEBI and has no investor protection, so keep any amount small or prefer ETFs. - **Jewellers' gold savings schemes** let you pay a monthly amount for 10 to 12 months and then buy jewellery. They suit people who plan to buy jewellery anyway, not investors. **Sovereign Gold Bonds**, which paid 2.5% interest on top of the gold price, are no longer being issued. Existing bonds continue to maturity and can be bought or sold on the stock exchange, sometimes at a discount. ![Ways to own gold, best first: a gold ETF or gold fund, then hallmarked coins or bars, and jewellery last.](https://finniki.com/blog/media/dae266ecaf6db1a51d5784d0.jpg) ## Should you buy silver too? It can diversify your precious-metals holding, with more risk. Unlike gold, silver has large **industrial uses**, in solar panels, batteries, electronics and electric vehicles, so it can rise faster when industry booms and fall harder when it slows. Silver swings more than gold: after its 2026 rally it fell about **17% in October alone**. If you add it, use silver ETFs and keep it small. ## What about silver arbitrage? The episode described a rare gap in 2025 between physical silver, silver ETFs and MCX futures prices that some experienced traders exploited by selling where silver was dear and buying where it was cheap. Such gaps close quickly, and the trade needs futures experience, delivery and compliance arrangements and capital to handle reversals. It is not for beginners and it is not an investment strategy. ## How does Nikhil invest in gold? He mainly holds **gold ETFs**, for convenience, and keeps a small amount of physical gold as a coin, not jewellery: practical, digital and a little emotional, because Indian households and gold are inseparable. ## Why do Indians love gold so much? Because for Indian families, gold is culture, tradition and security, not just an asset. A Morgan Stanley report in October 2025 estimated that Indian households hold about **34,600 tonnes** of gold, worth about **$3.8 trillion**, roughly three times their direct equity holdings. Keep jewellery for tradition and sentiment, but build wealth with financial gold, and keep the two separate in your mind. ## FAQs ### Is now a good time to buy gold? Yes, if you are buying a 5 to 10% allocation for protection and building it gradually. No, if you expect quick gains: gold can fall 5 to 20% even in a long uptrend. ### What is the gold price in India now? About ₹1.44 lakh per 10 grams of 24-carat gold in late October 2026, down from above ₹1.5 lakh earlier in the year. ### What is the best way to buy gold in India? Gold ETFs, or gold mutual funds if you do not have a demat account. Buy hallmarked coins or bars for physical gold, and avoid jewellery as an investment. ### Is digital gold safe? It is not regulated by SEBI and has no investor protection, as SEBI warned in November 2025. Keep any holding small, or use gold ETFs instead. ### Can I still buy Sovereign Gold Bonds? Not from the government: no new tranches have been issued since February 2024. Existing bonds trade on the stock exchange. ### How much of my portfolio should be in gold? About 5 to 10%. ## Fit gold into your plan How much gold you need depends on the rest of your portfolio. [Book a session](https://finniki.com/book) to set your allocation, or find more episodes on [FinNiki videos](https://finniki.com/videos).