Today’s Gold Rate in Hyderabad

After the roll out of GST (Goods & Services Tax) in July 2017, the final taxation rate on gold was 3% which is slightly higher than before but lesser than expected. For jewellery lovers, GST has come up with a bad news. Earlier, the making charges were exempted from service tax. However, under GST there are no exemptions and a GST of 18% will be applicable on the making charges. This had affected the gold demand in Hyderabad initially, but is likely to benefit the organized trade.

KDM is basically used for gold jewelleries which has cadmium in it. This metal is used because of its low melting point properties. However, it has been banned due to its toxic fumes and skin allergies.  Hallmark 916 gold is preferred gold to buy in Hyderabad, especially for jewellery purposes. This is basically 22 carat gold purity. If you wish to buy gold jewellery then go for hallmarked gold of 22 carats (or 24 carats), depending upon your price and preferences.

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Hyderabad is a hub of pearls and gold. That’s why people prefer to use gold as an investment to diversify risk. As compared to any other precious metal, gold has better hedging properties across the country. Also, it is a preferred investment that can be used as a hedge against inflation and deflation. In Hyderabad, people invest in gold in the form of:

Jewellery: When it comes to Southern India, Hyderabad is one of the biggest gold jewellery buyers.

Coin & Bullions: For the purpose of only investment, people prefer coins and bullions which are available in various purity ranges and weight.

Commodity Exchanges: Gold can be traded as a commodity for varying tenures in exchanges like MCX (Multi Commodity Exchange of India), NSEL (National Spot Exchange Limited) or NCDEX (National Commodity & Derivatives Exchange). This contract is available as spot contracts and futures contracts.

Forms of Gold Investment Options in Hyderabad

A number of local shops as well as renowned jewelers and dealers in and around Hyderabad that offers competitive rates, are available round the year. Like many other cities in India, Hyderabad has a well-contained market dedicated to precious metals that offers a wide range of products from raw metals to beautifully shaped gift items. Owning gold is now simple and convenient, which makes it the safest and the quickest option for gold buyers for investment purposes. For gold investments, one can either buy physical metals in forms of gold jewellery, gold bullion coins, and gold bars or opt for e-gold investments, exchange traded funds, gold funds etc.

Let’s have a look at these options for gold as an investment in Hyderabad in detail:

Physical gold: The oldest and most common way to invest in gold is in the physical gold, which includes jewellery, gold bar and gold coins. Jewellery is a love of women as women love to invest in gold for fashion reasons, whereas many men love to buy gold bullion bar and coins for investment purpose.

Gold ETF: Another way of making investments in gold is via Gold ETF, which is an online version of physical gold. Gold ETFs are similar to stocks, and to invest in them, an investor needs to have a demat account. Gold ETF is a great investment option for investors in Hyderabad who look for something which is easy to liquidate as well as get exposure to gold for investment point.

Gold fund of Funds: Gold funds are an equity fund which is invested in another parent mutual fund, which are related to gold activities. Investors in Hyderabad who want to track gold prices do not invest in gold fund of funds as these funds do not invest most of their money in gold, but in gold related companies.

Gold Saving Funds: Gold Saving Funds are the mutual funds which are invested in real gold. Hyderabad investors who do not have a demat account invests in gold saving funds. Gold investors can invest regularly in gold through SIP through this fund.

e-Gold: e-Gold is similar to Gold ETF as in this gold buyers can invest in Gold in online format. To invest in e-Gold, one needs a demat account. Investors can also take physical delivery of gold with some terms and conditions.

Carat is basically a term used to denote the purity of the gold. Let’s understand the difference between 24K, 22K and 18K Gold:

24K Gold: This is 100% gold without traces of any other metal. This is the purest and the higher form of gold. Obviously, it is most expensive and not suitable to make jewellery.

22K Gold: This gold is 91.67% pure. The rest compiles of metals like silver, zinc, nickel and other alloys. Although, this gold is used to make jewellery, it is not recommended for diamond and other studded jewellery.

18K Gold: This is 75% gold with 25% other metal like copper or silver. It is slightly dull in color and is used to make diamond and other studded jewellery.

Gold future contracts are an alternative investment class which can be used to manage the price risk on an expected purchase or sale of gold. Only the price varies. It is a legal binding financial contract for the delivery of the gold in the future upon a set rate. This type of contract offers better financial leverage and flexibility as you can trade high market value product with a fraction of its total value. This means higher return. However, these contracts are highly risky as well and investors might lose more than investment.

Local Factors: Excise duties of gold which affects the gold price. If the duty reduces, the prices reduce.
International Factors: If the Dollar increases against other currencies then the process of the gold will fall. Also, when the interest rates decreases, it will also affect the gold rate.
In any case, the rate of gold in Hyderabad keeps on fluctuating.

There is no particular formula to determine the gold rate in Hyderabad. However, there are several factors that affect its price:

Price of US Dollar: The price of gold goes down in case the rate of US Dollar goes down due to weak global cues.

Silver Price in Hyderabad: There are gold investors who follow the rate of silver in Hyderabad and its fluctuations help them determine the future gold rates in Hyderabad.

Exchange Rate of Indian Currency: The rupee rate, stock prices and gold rates are inter-related with each other. Therefore, in case the exchange rate of Indian currency changes then it will affect the gold rates as well.

Hyderabad is a hub for gold jewellery. Popular jewellery shops have been spread all over the city. There are many renowned jewellery chains like Tanishq, Malabar, TBZ, etc. which offers a variety of hallmarked jewellery at good price. Other than these, there are many local jewellery shops like Chhaganlal Jewellers, Sri Krishna Jewellers, Shree Jewellers, Taruni Jewellers and many more. If you are going to buy gold jewellery in Hyderabad, then make sure that you go for a recognized jeweler.

Also, ensure that you buy nothing but the hallmarked jewellery. Don’t forget to check the 916 hallmark stamp on each jewellery piece. Also, ask for proper bill after you purchase. In this world of digitalization, gold jewellery is also available online. The biggies in the jewellery industry like Tanishq, Kalyan, Malabar, etc. have online shops from where you can purchase gold jewellery and get it delivered in Hyderabad.

• Cheaper Interest Rates: It is secured loan option backed by an asset of good value. That’s why the risk of loss is less. Also the interest rate of gold loan is cheaper than personal loan by 3-4%.
• Good option for low credit scorers: If you are among those who scored low in your credit score, then taking a gold loan is one of the best options for you.
• Lesser Documentation: Unlike other loan application, the paperwork is least in taking a loan against gold. All you need is your photo ID, address proof, recent photographs and of course the gold.
• Lesser Processing Time: This is one of the quickest options in the times of financial emergencies. The valuation, verification, approval and processing takes few hours online.
• Short Tenure: Gold loan is short term loan option. If you are sure about the short term cash flow and about repaying the loan, this is the best option for you.