Use the current phase of correction to build your allocation to gold

It can act as hedge against high inflation or slowdown

Gold exchange-traded funds (ETFs) saw inflows worth Rs 446 crore in September. This was despite gold ETFs declining 7.7 per cent over the past year.

Opportunistic buying

Various factors were responsible for last month’s inflows. In the aftermath of the Covid-19 pandemic, people have increasingly realised that some allocation to a safe-haven asset like gold is essential.

With the equity markets wi­tnessing a steep run-up, many investors are booking profits.

"Since returns from fixed-income instruments are currently low, investors are allocating some of the profits booked in equities to gold," says Chirag Mehta, senior fund manager-alternative investments, Quantum Mutual Fund.

Most gold investors tend to