Looking at Gold Price History in India ★ Should you Invest in Gold?

Gold has always fascinated us Indians but you may not realise that it is a very volatile asset. We look at Gold Price History in India since 1964 or for more than 55 years. These numbers are sourced from RBI reports.

If you look at the numbers in the table below, you would realise there has been a lot of fluctuations in the price. The green shaded years are the ones where the prices have gone up by more than 20% as compared to previous year. The red shaded years are where the prices have come down from last year.

YearGold Price (Rs.)YearGold Price (Rs.)YearGold Price (Rs.)
56 Year Gold Price History in India

The prices above are approximate average of gold prices for the year.

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Gold Price History in India Trend

If you look at the trends in Gold Price below, the gold prices rallied in 1978 to 1981 and rose 4 times in 4 years. The second rally came after 2004 and in next 8 years it went up from Rs 6,000 to 31,000 – more than 5 times in 8 years.

There was stagnancy with slight dip in the gold prices from 2012 to 2015. It again saw a sharp rise of ~40% in 2020 due to global pandemic.

Gold Price History in India since 1964
Gold Price History in India since 1964

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Gold Price History in India – Return on Gold

Below is the chart showing the rolling return on Gold for 1, 3 , 5 and 10 Years period. For e.g. for 5 years rolling return its assumed that you buy Gold every year and sell it after five years.

Gold Price History in India - Rolling Returns for 1 to 10 Years
Gold Price History in India – Rolling Returns for 1 to 10 Years

The significant point to note here is except for 10 Years rolling return gold at some point of time has given negative returns. The worst period for Gold has been 1997 – 2002 and 2012 – 2015 where the Gold prices remained virtually stagnant. This graph also proves that returns in Gold is not always positive which most of us assume. Its depended on market factors, currency equations and economy.

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Looking at Gold Price History in India - Should you Invest in Gold
Looking at Gold Price History in India – Should you Invest in Gold

Should you Invest in Gold?

Gold has been considered a valuable asset in India from time immemorial. There has always been a conception that Gold prices never fall. However if you look at 56 years Gold Price History in India in tables & charts above – you can find years with spectacular rallies and years with fall in prices. So gold is also a volatile asset. However if your investment is for long term, the chances of loosing money goes down substantially.

The table below shows what happens if you invest in gold for 1 Year, 3 years, 5 years and 10 Years. Based on the Gold Price History in India since 1964, we can say the volatility of gold decreases as your investment tenure goes up. Also the chance of loosing i.e. getting negative return is 0 if the investment was for 10 years or more.

This is how we have calculated % chance of loosing money. For 1 Year rolling returns we have total of 57 instances since 1964, in this 10 years gave negative returns compared to previous year. So the ration for 1 year rolling goes to 10/57 = 18%

Rolling YearsAverage ReturnMinimum ReturnMaximum Return% Chance of Loosing Money
1 Year13.6%-20.0%81.7%18%
3 Years12.9%-6.4%39.9%11%
5 Years12.4%-3.6%33.0%8%
10 Years12.3%1.4%25.0%0%
When can you loose money in Gold?

Should you invest in Gold? Based on the Gold Price History in India it seems its a good idea to invest some part of your assets in gold for long term.

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How to Invest in Gold?

Below are the most popular ways to invest in Gold:

  1. Sovereign Gold Bonds
  2. Gold ETFs
  3. Gold Fund of Funds
  4. eGold
  5. 24 carat Coins & Bars
  6. Jewellery

The first 4 is like investing in “Gold on Paper” as you do not have any physical gold with you. Out of the above I personally recommend investing through Sovereign Gold Bonds due to following reasons:

  • You get interest of 2.5% every year on your gold
  • You need not worry about the purity of gold
  • You have no worry about storage
  • The buying and selling is easy – you can do it all online from comforts of your home
  • In case you need to exit in emergency, you can resell it through stock market
  • There is no capital gains tax on gains you make (if you redeem the bonds on maturity)

Know about the latest issues of Sovereign Gold Bonds

Sovereign Gold Bonds are one of the better ways to invest in gold. It’s safe, backed by government of India and you need not be worried about purity of gold or storage. The icing on the cake is you get interest paid on your investment. You can buy these Sovereign Gold Bonds from NSE/BSE but the liquidity is a problem. So it’s a good idea to subscribe to latest issue of Sovereign Gold Bonds which comes almost every month.

We hope the Gold Price History in India for more than 55 years would have helped you take informed decision for investing in gold. Just a word of caution “in investment the history may not always repeat itself”

16 thoughts on “Looking at Gold Price History in India ★ Should you Invest in Gold?”

  1. I never knew that I can invest in Gold ETF with my Kotak Stock Trader App also.
    It was so simple. Thank to this article. It helped me alot.

  2. Gold Price History in India

    I think the Gold is not a secure investment asset,because its prices are fluctuating unpredictable.In 2012 November Gold breaks its historic record to 24240 and after 6 month it again downed to 19500.So how can we select to Invest on Gold.

  3. we purchased a , 999.9, 24 ct gold coin (8 gm) from Bank of Baroda, New Delhi. where can i sale it? any official buyers available in India? if i sale it, can i get the exact money at that time gold value?

    1. You can sell the gold coin to any Jewelers in your neighborhood. In India banks sell gold but don’t buy back!

      You would get the 24 Carat gold price as per the prevailing rate.

      1. Jweller stores like Tanishq deduct 8% on the pure gold coins.
        It is a wrong practice but is being followed by many across the country.

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