E-gold and e-silver from NSEL in India
Almost every house in India, invests in precious metals, especially gold and silver. NSEL (National Spot Exchange limited), India has give a chance to retail investors to enter into the commodities market through its E-series product and invest in demat gold. Currently, NSEL offers only gold and silver trading in their E-series, but there are plans to include copper and nickel too. Rather than investing in physical gold, one can hold gold or silver in demat account, as it not only saves locker and insurance costs but can be bought in very small quantities. Small time investors can invest in small denominations, like 1 gram, 2 grams and so on, regularly.
Requirements:
Retail investors can open a demat account with any of the Depository Participants (DP) of NSEL like Karvy, IL & FS, Religare, Goldmine, Monarch Capital, SMC, SSD securities, India Infoline, and trade in this, just like mutual funds or equity shares. Visit this link for the full list of empanelled DPs for us to trade in egold and/or esilver. But remember that you need to have a separate demat account for trading e-gold and e-silver in commodities market backed by National Spot Exchange limited. Like with equities, trading settlement is done on T+2 days.
The holder can also take physical delivery of the gold, if he wishes to, by surrendering the required units to the exchange. Presently, there are three centers which offer physical delivery of gold in India and they are on the process of increasing this to many more cities in India.
Advantages:
Investing in e-gold and e-silver are seen as safer options today since they are not affected by inflation and other economic risks. Since gold is an excellent hedge against inflation, it is always best to buy gold as a short or long term investment.
E-gold and e-silver investment gives better returns as compared to ETF’s since the fund houses charge additional costs like AMC, vault charges which are comparatively lower here. National Spot Exchange charges 0.4 % annually while it is 2.5 % for ETFs. Transparent pricing, seamless trading, no holding cost are some of the advantages of e-gold and e-silver trading. Hassle free buying and selling of commodity is possible in demat gold and silver. It is emerging as a better alternative to ETF, which is like any other mutual fund.
Disadvantages:
The buyer is not the outright holder of the gold as the institution holds the metal on his behalf. With e- gold, security is always an issue as there is always a risk of account being hacked. Due to security breach losses can occur, which are irreversible but perhaps you are protected by insurance against this issue. Also there are custody charges that one has to pay at 60 paise per month.
This is just another way to buy our favorite commodity in which our Indians are more attached to than ever, the gold as well as silver. I would personally suggest you to go for this to buy e-silver if you already have an gold ETF account. But if you are looking have physical gold at the end of the investment period or when needed, go for e-gold offered by them.
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Comments
i want to know how to trade in e-gold and e-silver….
this is part of mcx or this is some things else…
waiting of some body reply…
thanks
Hi, Asif,
This is totally different from that of MCS. You can visit the website of NSEL to know more about it or contact your share broker who needs to have special account to trade commodities via NSEL.
1)What is the difference between investing in e-gold/e-silver and investing in gold by purchasing Gold Bees in normal demat form.
2)When one opts to receive silver or gold in physical form, by surrendering certain units , what is the gaurantee of its purity.
hi , i m frm sagar (m.p.) . I want to start investments in e-silver. I am a student , so plz give advice that how can i start investing..
I want to open an account for e gold and silver for trading kindly advice the procedure.
Just contact any of the NSEL approved brokers or agents and join via them.
Which DP is best to Open an account for E-Gold. Do I need to pay Opening charges and AMC charges??
Why did you say “The buyer is not the outright holder of the gold as the institution holds the metal on his behalf.”
Is that means we can’t hold the demat of units on our own name??
Rao
was searching for egold and e silver like products for a while. e silver is very good but the hacking possibility of the nsel a/c is a bit cause for worry. for retail investor there should be 100 % insurance and it should be totally city bank puri free i.e no hacking no such disadvantages like
I am an active trader in MCX & NCDEX. Now seeing this I wish to trade in this segment but before trading I wish to know how I can take delivery the same and what is the gurantee of its purity.
I am an NRI. Can I have get to do the e trading such as in gold ,silver,copper etc.if it possible how it to do it.
regards
No Kamlesh, you cannot use your regular demat account for e-gold or e-silver, you need to open a separate account for the same.
hi , i m frm sagar (m.p.) . I want to start investments in e-silver. I am a student , so plz give advice that how can i start investing..
to get list of dps and broker mail me at siraj.pinjari@nationalspotexchange.com
Go to http://www.nationalspotexchange.com. You will find everything you need. Then select the broker. The list of brokers (DPs) are given there. Choose and ask the broker about a/c opening procedures.
sir ,
Iwant to invest in sliver for 2year, as in dematA/c, advice me how i can do,
thanks
atibir singh
I want to invest in e-silver & e-gold so pl let me know the procedures to execute the same and also pl let me know the risk factors and time bound benefit regions?
NOW A DAYS BUYING A GOLD IN NSEL IS AN EXCELLENT INVESTMENTS.YOU CAN BUY GOLD FROM DIRECT MEMBER OF THE EXCHANGE.
MARGIN IS UP TO U.
YOU CAN BUY 1 GRMS FOR CURRENT MARKET RATE. DEPENDING UPON YOUR INVESTMENT SAY FOR EXAMPLE TAKE 5000 IN THIS U CAN BUY 2 GRMS GOLD. IN FUTURE THE GOLD RATE WILL BE DEFINITELY INCREASED.
hi,
i have one doubt pls resolve.
suppose today i buy 2 grm gold for 5000,tommarow gold prize is high and for 2 grm it will cost 7000.if i want physical delivery of my gold.can i get 2 grms or the gold of 5000?
i.e. investor get the same grms whatever they are buy despite of current market prize.
Hi Rashmi
First you can sale e-gold i.e. Rs. 7000/- and same amount received from Broker afterthat physical purchase from market (i.e. Jewelers) you have profit Rs.2000/-
I want to open an account for e gold and silver for trading kindly advice the procedure.