Gold Is In The News. Here Is What It Means For Your Portfolio

This column spoke about gold in its early weeks. We spoke about why it belongs in a portfolio, the difference between gold jewellery and gold as an investment, and how to hold it through ETFs or mutual funds rather than physical form. That foundation still stands. But gold has been everywhere in the news lately. Prices moved sharply last year. The government first cut the import duty, then raised it back again. The Prime Minister publicly asked Indians to stop buying gold for a year. New ways to invest in it have appeared on the stock exchange. And many of you have written asking the same question: should I be doing something differently with my gold?

The honest answer for most investors is: probably not. And this week I want to explain why, and what the right way to think about gold actually is.

Productive vs Passive Assets

Gold is not an investment in the way that a mutual fund or a share is an investment. A mutual fund invests in companies that employ people, produce goods, earn revenue, and grow over time. A share in a company gives you a stake in that growth. These assets generate something. They work.

The Nature of Gold

Gold does not work. It sits. It does not earn interest or pay dividends. It does not build a factory or develop a new product. A kilogram of gold today is a kilogram of gold ten years from now. Its value does not come from what it produces. It comes from what people believe it is worth, and from the fact that when everything else feels uncertain, people want to hold something real and unchanging.

The Portfolio Anchor

This is gold's actual job in a portfolio. It is a hedge. When equity markets fall, gold often rises. When inflation eats into the value of paper assets, gold tends to hold its ground. When geopolitical tension rises and investors get nervous, gold is where they run. You do not hold gold to get rich. You hold it so that when your equity investments are having a bad year, something in your portfolio is holding steady.

Ignoring the Headlines

Think of it as the anchor rather than the engine. This is also why you should not let news headlines about gold change your investment behaviour. When gold prices rise sharply, as they did in 2025, many people feel they missed something and want to buy more. When the government raises the import duty and prices move, people feel uncertain about whether to buy or sell. When the Prime Minister says do not buy gold, people wonder if their existing gold is safe.

ALSO READ- I Am My Own Laxmi: Beyond Savings Accounts, Let Your Money Walk With You

The End of SGBs

None of these headlines changes the fundamental role gold plays. If you already hold five to ten per cent of your portfolio in gold, through jewellery, gold ETFs, or gold mutual funds, you are exactly where you need to be. You have your hedge. It has likely appreciated recently, which is good. But that appreciation is not a signal to add more, any more than a falling stock price is necessarily a signal to sell. The investor who treats gold as a trading commodity, buying when prices are high because gold is in the news and selling when things calm down, will almost always end up buying high and selling low. Gold rewards patience and consistency, not active management. There are two updates from the gold world worth knowing.

The Rise of EGRs

The first is that Sovereign Gold Bonds, the government-backed product that offered gold price appreciation plus 2.5 per cent annual interest, are no longer available for fresh investment. The last tranche was issued in February 202,4 and no new ones have been announced. If you hold existing SGBs, they remain valid and will be redeemed at the gold price at maturity. But this product is no longer an option for new investors looking to add gold to their portfolio.

Finding Your Right Allocation

The second is that NSE launched Electronic Gold Receipts, or EGRs, in May 2026. Think of these as demat gold. Each EGR represents actual physical gold stored in a SEBI-regulated vault, which you hold and trade on the stock exchange exactly like a share. You can even convert it to physical gold if you wish. EGRs are available in small denominations, making them accessible to all investors. They solve the longstanding problem of physical gold: inconsistent pricing, purity uncertainty, and the inconvenience of storage. For now, gold ETFs and gold mutual funds remain more established and more liquid, but EGRs are a useful new option to be aware of.

Generational Wisdom

So where does this leave you as an investor? If you have no gold allocation, a five to ten per cent exposure through a gold ETF or gold mutual fund is a reasonable addition to a diversified portfolio. Not because gold is in the news, but because this allocation has always made sense and always will. If you already have gold in some form, check that it falls within that range of your total portfolio. If your gold jewellery alone already exceeds ten per cent of everything you own, you likely have enough. If you have existing SGBs, hold them to maturity.

And if someone tells you that gold is at a great price to buy right now, or that this is the worst time to buy, both statements probably say more about their opinion of the current mood than about your long-term financial plan. Because gold has been in Indian women's portfolios for generations. Not because our grandmothers were watching import duty notifications. But because they understood, intuitively, that not everything of value needs to be in motion.

ALSO READ- Loans Explained: What Every Woman Should Know Before Borrowing

Write to us at iamolaxmi@gmail.com. We read every letter.