Anuj Gupta recommends staggered gold investment for long-term gains

"Gold demand is not coming only from the individual. Even we have seen lots of central banks increasing their gold holdings. So, the demand is the main reason that gold prices are increasing in last almost five years," says Anuj Gupta, HDFC Securities.

My grandmother used to say, buy gold, do not ever sell gold. It is coming out so true. Gold is up 15x in last 20 years. Why is gold prices moving the way it is moving?
Anuj Gupta: See, the demand is the only concern is the main reason that gold prices increased sharply. And also, the uncertainty in the global market. In last five years, in COVID or after the COVID, we saw a huge jump in gold prices due to the demand because now investors are taking gold as an investment, not as a jewellery, so we saw a huge demand in gold bar, in gold coins, the demand is increasing.

But if you see that the demand is also coming in the gold due to the uncertainty mahaul and also, we have seen that due to the correction in dollar index now central banks is also buying gold.


So, gold demand is not coming only from the individual. Even we have seen lots of central banks increasing their gold holdings. So, the demand is the main reason that gold prices are increasing in last almost five years.

Everyone is questioning where further from this one lakh mark and will the rally hold or do you think it is close to topping out at least in the near term?
Anuj Gupta: See, silver already touched one lakh, but gold is still on MCX is trading around 88,350 and on spot market internationally it is trading around 3,012 which is the highest price till. So, as far as concern about the future perspective, we are expecting that gold may test $32 per ounce till the end of the financial year and on MCX if we talk about we are expecting that it may test 90,700 or 91,000 odd levels.

So, the trend is still bullish and we saw in the financial year, since the first of Jan 2025, we saw the gold and silver only the asset class which are performing as compared to other asset classes. So, we are expecting that the trend remains same and expecting a positive trend may be come in this financial year.


What could be the triggers at play for gold now? Could it be this safe haven buying or could it be the central bank buying?
Anuj Gupta: See, right now the safe haven demand is there. However, central banks are buying the gold but it is a little bit slow. But yes, that safe haven demand is increasing because again, we saw geopolitical tension between the Hamas war, so that is again creating a safe haven demand and also the Trump tariff plan which is creating uncertainty in Europe, China, even US, and Mexico, Canada.

So, these are the big economies and uncertainty in the economy definitely provides support to the gold prices. So, however, geopolitical tension is there, but yes, safe haven demand due to this uncertainty support the gold prices.
But yes, central banks are still buying the gold and even recently, two months back, China was also buying gold for their central bank. So, definitely there are lots of small economies where central banks are buying gold. Even India is also buying gold for their reserves.

You did speak about what is exactly happening in the gold and the way how it is actually drivers leading to this sort of an uptick coming in? But what is your analysis? Do you think that this will sustain going ahead and as an asset quality now, you can actually go safely park your money in gold or no, it is a no go now because given the fact that the levels are very much elevated even back in the Indian markets?
Anuj Gupta: See, I am always saying that gold is a process of investment, means if somebody wants to invest in gold, so he can start with 10% at current level and every correction they can buy gold. So, it is not a lump sum investment process, it is a SIP kind of thing because there is a lot of product available in the market, you can say gold, MCX gold is available and even gold ETFs are also available in the market.

So, start investing in gold in a process way, start investing in a staggered way. So, whenever there is any correction, there is opportunity to buy in the gold.

As Nikunj rightly said that it is a long-term process, means a grandmother told to buy the gold and not sell the gold, so that is again the proof that gold is for the long-term perspective, not for the short term.

So, if we want to hold gold for long-term perspective, then we have to create a process to invest in the gold in a staggered manner.

Can gold go to one lakh? Everybody is saying the same thing. I have got four WhatsApp messages.
Anuj Gupta: Yes, see, I can say right now, but yes, definitely as the long term horizon definitely it may test one lakh.

Is there a way which we can look at gold technicals and say this is overbought, underbought? I mean, what is the real value for gold because everything ultimately has to have an underlying price whether it is gold, silver, stock, bond, real estate, it has to have a utility value, it has to have an affordability value, it has to have a security value. What is that real, true value where gold can be called as an asset and not bubble?
Anuj Gupta: People have not used gold for the selling perspective, they are always buying gold for the holding perspective. So, there is a no overbought zone. But yes, definitely, there is a correction because somehow people are selling their old jewellery to change in the new jewellery.

So, generally, if you see people are not selling the gold for the money. Generally, they are selling the gold to buy the new design of the gold in terms of jewellery and even they sell the gold to exchange the jewellery. So, generally, only 1% or 2% people are using gold to sell for money.

But if you check the Indian perspective, in India, there is no chance to sell the gold and even no household selling the gold. So, there is no bubble kind of thing. But yes, definitely technical correction might be there.

So, it is shifting their ranges timely and whenever we saw any correction, it corrected only 20-30%. So, if it corrected by 20-30%, possibly it might test 2800, so that would be the point where an investor can enter again in the gold prices.