Should you invest in Gold Funds in India

Physical gold such as gold jewelry or gold coins has several drawbacks such as storage in safety vaults and the associated locker charges. They also demand price markups due to the design and making charges. Apart from these, purity issues and lack of flexibility in investment amounts can make buying physical gold inefficient. In contrast, Gold ETFs and Gold Fund of Funds have become popular forms of investment. Gold ETFs have received rising net inflows from investors. The number of folios in Gold ETF surged by almost 10% in June to Rs. 18.32 lakh from Rs. 16.68 lakh in May as per monthly data from AMFI. Another way of investing in Gold digitally and overcoming the drawbacks of investing in physical gold is by investing in gold fund of funds instead.

The meaning of Gold Fund of Funds is an open-ended fund which has an underlying investment in Gold ETFs, that in turn is backed by physical gold and tracks the domestic price of Gold. The NAV is declared at the end of the trading day similar to other mutual funds. One can invest in a Gold Fund of Funds via an SIP, where you can invest a minimum of Rs 500. When comparing gold funds vs gold ETF, one doesn’t need a DEMAT account for investing in a gold fund of funds. The capital gain arising out of redeeming Gold Funds within less than three years is subject to short-term capital gains tax which will be taxed as per Income Tax slabs. For capital gains arising for a holding period of more than three years, then it will be long-term capital gain, which will be taxed at the rate of 20%.

Gold acts as a strategic asset in an investor’s portfolio, given its ability to be an effective risk-reducing portfolio diversifier. It helped alleviate losses for investors who owned them during the pandemic.

With the fall in gold prices in response to the strengthening of the US dollar in Jun 2021 and talks of interest rate tightening as early as CY 2023, investors can consider allocating a portion of their portfolio to Gold.

While selecting a Gold fund of Funds, just like any mutual fund, investors need to analyze the fund based on certain quantitative and qualitative parameters, that one can use to arrive at the best gold funds as per their requirements. Additionally, it would be best if one were to keep their financial goals, risk appetite and investment horizon in mind.

Disclaimer: The views expressed here in this Article / Video are for general information and reading purpose only and do not constitute any guidelines and recommendations on any course of action to be followed by the reader. Quantum AMC / Quantum Mutual Fund is not guaranteeing / offering / communicating any indicative yield on investments made in the scheme(s). The views are not meant to serve as a professional guide / investment advice / intended to be an offer or solicitation for the purchase or sale of any financial product or instrument or mutual fund units for the reader. The Article / Video has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Whilst no action has been solicited based upon the information provided herein, due care has been taken to ensure that the facts are accurate and views given are fair and reasonable as on date. Readers of the Article / Video should rely on information/data arising out of their own investigations and advised to seek independent professional advice and arrive at an informed decision before making any investments. None of the Quantum Advisors, Quantum AMC, Quantum Trustee or Quantum Mutual Fund, their Affiliates or Representative shall be liable for any direct, indirect, special, incidental, consequential, punitive or exemplary losses or damages including lost profits arising in any way on account of any action taken basis the data / information / views provided in the Article / video.

Network Marketing – The Power of the Presentation

Presenting your products or business opportunity is one of the key income producing activities required for your network marketing business to become successful. The purpose of the presentation is to provide your prospect with the necessary information for him or her to make an educated decision about your products or business. You will need to decide what information you want to present, what format (DVD, CD, webinar, hotel meeting, 1-on-1, etc) to use, and who is going to present.

Deliver the Presentation

If you remember back to your speech class, the basic formula is to tell them what you are going to tell them; tell them; then tell them what you told them. That is the basic idea, but let’s expand that just a bit. It makes sense to start off with an overview of what you are going to talk about. It also makes sense for you to tie your presentation into what your prospect needs, wants, or doesn’t want. Let them know from the start that you are interested in making their life better.

Now, as you are making your points, you will want to make sure they understand what you are talking about. It’s easy to ask ‘Does that make sense?’ But, a more effective way ensure understanding is for you to ask your prospects to explain your point back to you in their own words. That way you can make sure that you are both on the same page. Move through each of the important points making sure that you have not lost them.

After you have completed all of your main points, come back around and summarize them. You want to keep your presentation as simple as possible. Now is not the time to dazzle your prospect with your brilliance. You want them to believe that they can do what you just did. Maybe not right away, but they need to have confidence that they can do it, too.

Practice, Practice, Practice

Have you ever done a presentation where you practiced on your audience? How did that work out for you? I don’t care how good you are, you would have been better if you practiced on your own, first. Steve Jobs has a reputation for giving killer presentations. Do you think it comes out perfect the first time? No, he spends days – not hours – but days preparing his talks.

You must practice long enough so that is doesn’t sound rehearsed. That’s what Hollywood does, isn’t it? Your favorite actor or actress gets paid millions of dollars to look natural. This really is what separates the professionals from the amateurs. Practice!

Handling Objections

Now, some people say they love objections because it means the prospect is actively in the game. But is still makes people uncomfortable when their prospect is opposed to something that they said. As part of your preparation, you should also rehearse your responses to the most common objections to our industry. They’re not kept secret.

The top four objections for network marketers are:

1. MLM is a pyramid or scam;
2. I don’t like sales;
3. I don’t have time; and
4. I don’t have any money.

If you run into others, then start adding them to your list. Do you think politicians have all of the answers off the top of their heads? No. They anticipate what questions might be asked and they prepare and rehearse their answers ahead of time. You do the same.

The key is to rehearse how you would handle each objection. Because you know what to expect and you have practiced your ‘script’, you will have the confidence and posture of a network marketing professional.

Focus On Core Concerns When Negotiating

I’ve recently been reading “Beyond Reason: Using Emotions as You Negotiate” by Roger Fisher, coauthor of the bestselling “Getting To Yes” and Daniel Shapiro, associate director , Harvard Negotiation Project. It is an interesting book with some valuable explanations of how we can channel emotions by respecting five concerns which enable negotiators to reach mutually beneficial results.

The book is based on the premise that we negotiate daily and we have emotions all the time. Since we cannot eliminate emotions, “Beyond Reason” offers a strategy to generate positive emotions and to deal with negative ones. The book builds upon “Getting to Yes” which was coauthored by Fisher and is considered a foundation for interest-based negotiation, a process that suggests that negotiators obtain the best results by understanding each other’s interests and working together to produce an agreement that will meet those interests as best they can.

Emotions will have an impact on negotiations, whether we acknowledge them or not. Rather than dealing with each and every emotion that we have, and that our opponents are feeling, “Beyond Reason” presents a strategy where you turn your attention to what generates these emotions. According to the authors, “Core concerns are human wants that are important to almost everyone in virtually every negotiation. They are often unspoken but are no less real than our tangible interests. Even experienced negotiators are often unaware of the many ways in which these concerns motivate their decisions.”

The five core concerns that stimulate many emotions during negotiations are appreciation, affiliation, autonomy, status, and role. By dealing effectively with these concerns, you can stimulate positive emotions. The five concerns are not distinct from one another, but merge together with each contributing toward the stimulation of emotions. Therefore, each concern must be met to the appropriate extent, which will be different in each negotiation. These concerns can be used to understand the emotional experience of each party as well as a lever to stimulate positive emotions in parties. Lets briefly look at each concern, emotions that arise from each concern, and what people are prone to do once those emotions arise.

Appreciation

When a person is appreciated, resulting emotions can be enthusiastic, affectionate, cheerful, and caring. A person feeling these emotions will often be prone to cooperate more. A person who is unappreciated will often feel angry and disgusted. These emotions often lead to a person being prone to react negatively and contrary to desired interests.

Affiliation

When a person is treated as a colleague they tend to feel more amused, compassionate and ecstatic. These emotions tend to make a person more prone to work together. The person who is treated as an adversary is more apt to feel resentful or irritated. This person will be more prone to go it alone rather than work together.

Autonomy

When a person’s freedom to decide is acknowledged, emotions such as being proud, happy, and accomplished are evoked. These emotions tend to make a person prone to being creative. On the other hand, when autonomy is impinged, the emotions of guilt, shame, and remorse often arise, leading to a person thinking more rigidly.

Status

When a person’s status is recognized, they will often feel more calm, relieved, and relaxed. This tends to make a person more prone to be trustworthy. When a person’s status is put down they will feel humiliated and embarrassed. People with these feelings often are more prone to act deceptively and be seen as untrustworthy. (Note that they are seen as untrustworthy, not necessarily actually untrustworthy.)

Role

When a person’s role is fulfilling and includes activities that illustrate and convince the person that they make a difference, the feelings of hope arise. Hopeful people tend to be prone more toward trustworthiness similar to the above description related to status. When a person’s role is trivialized and restricted they may feel envious, jealous, or become apathetic. As with the description of status, these feelings tend to make a person more prone to act in the eyes of their opposition deceptively and be seen as untrustworthy.

Conclusion

Negotiators often assume that the best way to negotiate is purely rational. Hostile emotions easily escalate and cause problems. However, according to Jamil Mahuad, Former President of Ecuador, emotions can be helpful. In 1998, a fifty-year boundary dispute between Ecuador and Peru ended through the successful negotiation between Jamil Mahuad, president of Ecuador (1998-2000), and Alberto Fujimori, president of Peru (1990-2000). President Mahuad took two negotiation courses at Harvard with Fisher and a seminar with both Fisher and Shapiro regarding the core concerns outlined above. He contributed to “Beyond Reason” by sharing his creative use of the five concerns when negotiating to resolve the Peru-Ecuador border dispute. According to Mahuad, he took the initiative and acted upon each of the core concerns – appreciation, affiliation, autonomy, status, and role when going into the negotiations with President Fujimori. Doing this enabled him to establish good rapport, a strong working relationship, and a stable agreement.

During your next negotiation, determine how you can meet these core concerns in others as well as in yourself. Express appreciation. Build a sense of affiliation. Respect each person’s autonomy and status. Help shape roles to be fulfilling. According to Fisher and Shapiro, doing this will turn a negotiation from a stressful, worrisome interaction into a side-by-side dialogue where each of you listens, learns, and respects the other. This undoubtedly will improve your outcome. If these concerns can help the presidents of two countries resolve a fifty-year dispute, they just might help you negotiate successfully as well.