Parking short term cash in GOLD ETF

POSTED BY AaamInvestor ON August 4, 2011 4:28 am COMMENTS (2)

I need to park 8 – 10 lacs of cash for downpayment for a real estate purchase in 3 to 4 months. Considering the bullish trend in GOLD and today’s negative sentiment in equities due to US debt crisis, is it sensible to park this cash in GOLD ETF instead of putting it in savings account or short term FD to get some extra return

  1. Is it risky?
  2. Compared to short term FD, would GOLD ETF returns be better after short term capital gain tax?
Thanks

2 replies on this article “Parking short term cash in GOLD ETF”

  1. Anand says:

    To be on safer side, you can invest in cash funds such as fidelity cash fund to earn 7.5% to 8% of returns. In this way, you can have liquidity too, unlike FDs.

    Investing in gold with such a short duration is risky!

  2. Jagadees says:

    If you are able to stand same amount of loss equal to the extra return you are talking about means, you can go ahead. But generally it is not advisable and better stay with FD.

    Regards

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