FD Vs Gold ? Which is the best investment option in 2021 and why?

This is a very common question that arises in the mind of new investors that where they should invest. Whether they should invest in gold or in FD(Fixed Deposit). Here we will give you the answer to this question.

FD stands for Fixed Deposit. As it is clear from its name that it is Fixed Deposit. You Only Deposit money once in FD and you will get interest on that amount. Currently Due to Lower Repo Rates Banks are offering 6-7% on FD. Some NBFC’s are offering 7-8% Interest on FD. So Return on FD ranged between 6-8%

Gold in India is considered as an emotion. We Indians Gold on Special Occasions such as weddings. In the last one year, Gold Gave a return of around 28%. Whereas during the same period Sensex showed a growth of 16%.

Due to Covid-19, When all the economies of the world is contracting then as safe instruments investors invest heavily in gold.

In India Now, the cases of Covid-19 are decreasing slowly and marriages that are postponed in 2020 will now be completed in 2021. This will create the demand for gold in India and which will directly increase the Price of Gold in India as we import Gold to fulfill our requirements.

Gold as an Investment

we Can invest in Gold in 2 ways.

1- Gold Sovereign Bond

Gold Sovereign Bond is presented by RBI. In Gold Sovereign Bond you purchase 24K Pure Gold in Digital Format. The price of the Bond is fixed as the average price of the last 5 days of the issuance date of the Bond. You get 2.5% yearly interest under this bond. Selling Value is the current value of Gold at that time. For Example you purchased a Gold Bond at Rs 4,000 per gram and now after one year if you want to sell this bond and the current price of Gold Bond is Rs 5,000 so you will get 5,000+ 2.5% interest on RS 4,000.

2-Through Mutual Fund

If You don’t have a Demat account then you can invest in Gold through Mutual Funds. In Mutual Fund You will get the NAV of Gold. NAV Value Changes every moment with the change in Gold Price.


So Gold is the Better Investment option as compared to FD as it offers 10% compound Interest whereas FD gives 6-8% return.

You should have at least 10% of Gold in your portfolio because Gold Price will always increase



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