Dhanteras 2016: Significance of investing in gold today, and 3 things to keep in mind while buying

Why buy gold on Dhanteras?

According to Indian mythology, King Hima’s 16-year-old son was doomed to die by a snake-bite on the fourth day of his marriage. When his wife found out, she did not let anyone in the house sleep on the fourth night. She put all her ornaments and gold coins in a heap and sang melodious songs. When Yamaraj, the god of death, came in the form of a serpent, he was blinded by the shine of all the gold and sat dazed listening to the songs, thus, not killing the prince. This is said to be the reason why people continue to invest in gold and silver even today, to ward off evil and make way for blessings. People also light lamps to worship Yamaraj on Dhanteras.

A hallmark mentions the jeweller’s identification mark, year of hallmarking, karat and the stamp of BIS, make sure all these are there when buying jewellery (Source: AP)

Things to keep in mind while buying gold jewellery

It’s great to buy jewellery on an auspicious day, but it’s important to make sure you get the right deal as well.

1. Make sure you check for Hallmark: It is important you analyse the quality of the metal before investing in it, so that there’s no regret later. Try and go for gold jewellery with Hallmark. This certification helps authenticate the purity of the metal. It is the standard mark is seen in most gold. A hallmark mentions the jeweller’s identification mark, year of hallmarking, karat and the stamp of the Bureau of Indian Standards (BIS).

While many jewellery brands often mention ‘Karat’ in their advertisements, a lot of people don’t know what it actually means. Karat denotes the measure of gold’s purity. For example, 24 carat or 24K contains 100 per cent gold content. Since an ornament with 24K gold would mean pure gold, it is more expensive than 22K or 18K gold. Also note that gold is a soft metal and a pure gold jewellery will be more malleable because of its low density.

The BIS stamp is a certificate that assures the jewellery is made in accordance with the standards laid by the bureau, which is the national standards organisation of India. It also contains the hallmarking year of the jewellery. In addition to this, jewellers also carry their personal hallmark that includes the purity of the metal and the year of making.

2. Stay away from stone-studded jewellery: If you’re buying gold mainly as an investment, then keep away from from those studded with stones, especially semi-precious ones. Though they may look much more attractive, remember that while buying, the stone is weighed along with the gold, so the ornament is priced accordingly. This weight is subtracted if you intend to sell the piece later. Stone jewellery also entails higher making charges.

3. Check for buy-back offers: Many jewellers have buy-back offers, wherein if you sell your jewellery back to the same store, then they will take the weight of the piece when bought into consideration, giving you a much better valuation of your ornament instead of going to another jeweller, who will first check the purity of the piece (here the Hallmarking helps, though) and deduct making charges as well.

Of course, if you don’t want to take a chance, you could always invest in gold ETFs.