Ask Readers: Your views on Gold Prices

By
Hemant Beniwal
-
33
Ask Readers: Your views on Gold Prices

Last Updated on April 24, 2026 by teamtfl

A client called me in early 2026. Gold had just crossed Rs.1.5 lakh per 10 grams. His neighbour had made “tremendous returns” on gold in the last five years and was now suggesting he shift 40% of his retirement corpus into gold funds.

“Hemant, is this the right time to buy gold? Will it keep going up?”

My answer was the same as it was in 2011 when gold had crossed Rs.26,000 per 10 grams and people were asking me the same question. I have no idea what gold prices will do next. And neither does anyone else.

Quick Answer

Nobody can consistently predict gold prices. The right answer to “should I invest in gold now?” depends on your current asset allocation, not on anyone’s gold price forecast. 5 to 10% of investable portfolio in gold is a reasonable hedge. More than that is a speculative position that requires you to be right about timing – something even the world’s best investors cannot do consistently.

Gold prices India 2026 - should you invest?

Gold at Rs.1,52,000 per 10 grams – what the bulls say

The bull case for gold in 2026 is the same as it has always been:

  • Weakening US dollar relative to other currencies
  • Central bank gold purchases globally at multi-decade highs
  • Geopolitical uncertainty – wars, trade conflicts, supply chain fragility
  • Inflation concerns, particularly in India where the rupee has depreciated
  • Global debt levels at historic highs, making hard assets attractive

Each of these arguments has genuine merit. And some of the world’s most respected investors hold significant gold positions. John Paulson rode gold from 2009 to 2011. Ray Dalio allocates 5 to 10% to gold in his All Weather portfolio. Jim Rogers has been a commodities bull for decades.

But notice what all of them have in common: they hold gold as part of a diversified portfolio, not as the dominant position.

What the bears say – and why this matters

Gold does not produce earnings, pay dividends, or generate cash flow. Its price is entirely driven by what the next buyer is willing to pay. This makes it an inherently speculative asset – even when the speculation is well-reasoned.

Gold fell approximately 70% from its 1980 peak and spent the next 20 years recovering. An investor who bought gold at the 1980 peak waited until 2005 to break even. That is 25 years of zero real return.

In 2011, gold touched $1,900 per ounce and fell sharply. It took until 2020 to recover that level. Investors who bought at the 2011 peak experienced almost a decade of flat to negative real returns.

The question to ask yourself is not “will gold go up?” The question is: “Am I ready to hold for 10 to 25 years if it doesn’t?”

The framework that actually matters – asset allocation

Gold prices cannot be valued using any standard financial model. There is no P/E ratio, no discounted cash flow, no earnings growth. The only way to answer “is gold worth it at this price?” is to decide how it fits into your overall asset allocation.

Here is a simple framework I use with clients:

Under 5% in gold: Consider adding systematically via a gold ETF SIP. Not because gold will go up, but because low gold allocation creates portfolio fragility during currency or geopolitical shocks.

5 to 10% in gold: This is the target range for most investors. Review annually. Rebalance if the price rise has pushed your allocation above 10%.

Above 10% in gold: You are making a directional bet on gold, not a hedging allocation. Be honest with yourself about whether you are investing or speculating. If the latter, size it appropriately and have an exit plan.

Above 20% in gold: This is concentration risk. The neighbour who made “tremendous returns” in the last five years has taken a concentrated bet that happened to pay off. Past five-year gold returns are not a guide to the next five.

The Google Trends lesson – investors search when it’s already too late

When gold prices were at their lowest relative to equities in 2018 to 2019, almost no one was searching for gold investment advice. When gold crossed Rs.50,000 per 10 grams in 2020, search volumes exploded. When it crossed Rs.1 lakh per 10 grams in 2024, the phones rang again.

Investors search for an asset after it has risen, not before. This is the same pattern we see in equity – mutual fund SIP volumes peak near market tops, not near bottoms. It is human nature, but it is the most reliable way to consistently buy high and sell low.

The best time to add gold to your portfolio is when nobody is talking about it. That time is clearly not April 2026.

My view – trees do not grow to heaven

I cannot tell you that gold will fall. It may well continue to rise in 2026 and beyond. But I know that every asset that goes up a lot eventually corrects – and gold is no exception. What I can tell you is that your financial future should not depend on being right about which way gold moves next.

If you do not own any gold, add a small systematic allocation as a hedge. If you already own 5 to 10%, rebalance to maintain that allocation. If someone is telling you to put 30 to 40% of your retirement corpus in gold, ask them where they were when gold was at Rs.26,000 per 10 grams and nobody was excited about it.

Also read: Should You Invest in Gold Funds? The Case Against NFOs and How to Allocate Correctly

Not sure how much gold is right for your retirement portfolio?

Asset allocation in retirement is not about chasing what’s hot. It is about building a portfolio that survives 25 to 30 years of withdrawals, inflation, and market cycles. We help clients build and rebalance portfolios as part of our retirement planning process.

Book a Clarity Call

Frequently asked questions

Will gold prices continue to rise in 2026?

Nobody can answer this with confidence, including professional gold analysts, central banks, or commodity traders. The factors that support gold – dollar weakness, geopolitical risk, inflation, central bank buying – are real. But they were also real in 2012 when gold fell from $1,900 to $1,100. The only honest answer is: nobody knows, so make your decision based on your allocation target, not price predictions.

What percentage of my portfolio should be in gold?

Most financial planning frameworks suggest 5 to 10% of investable assets in gold as a portfolio hedge. This is not a growth allocation – it is insurance against currency devaluation, geopolitical shocks, and extreme inflation scenarios. More than 10% crosses from hedging into directional speculation. For most Indian investors building retirement wealth, equity and debt are the primary wealth builders; gold is the shock absorber.

Is gold a good investment for retirement in India?

Gold plays a supporting role in a retirement portfolio, not a leading one. It does not generate income (unless held as SGB, which is no longer issuing new tranches). It does not compound like equity. Over any 15 to 20 year period in India, a diversified equity portfolio has significantly outperformed gold. Gold earns its place as a hedge and diversifier – not as the primary retirement wealth builder.

Should I sell gold and invest in equity now?

If gold has risen significantly and now represents more than 10 to 15% of your portfolio, systematic rebalancing into equity makes sense. Not because gold will fall, but because you are accepting concentration risk in a non-income-generating asset. Use the STP (Systematic Transfer Plan) approach – do not exit all at once. Discuss the tax implications with your advisor before making large redemptions, especially for physical gold sold as capital assets.

What is your current gold allocation – as a percentage of total investable assets? Are you comfortable with that number? Share your view in the comments.

33 COMMENTS

  2. Hi Hemant
    Indians are lapping up gold very enthusiastically.India is the largest gold consumer in the world.Its appetite for the yellow metal seems insatiable. Every year the import of old in the country is increasing. In spite of runaway increase in gold prices gold imports do not show any indication of decline. This perhaps is the most compelling evidence in favour of robust domestic demand growth.

  4. Hi Reema
    I have already mentioned that investment and insurance should not be mixed. I don’t understand your purpose of investing in Reliance scheme. You should go for term insurance if you have dependents.
    To meet your goal you should invest only in diversified equity funds. Moreover you should not have more than one scheme of the same fund house. You can invest in one large cap fund, one muticap fund and one mid and small cap fund. Before selecting a fund see its track record. You can refer to the post – Best Mutual Fund For SIP.

  5. Hi anil,
    i can invest 7000 thousand per month.my goal is 50 lakh after 15 years.now i giving
    1-hdfc top 200-1000/m
    2-hdfc prucedential-1000/m
    3-icici gold saving fund-2000/m
    4-reliance super invest assure plan-10000/anuaaly.will my portforlio help me to acheive my goal or i should add more?
    2

  6. Hi anil,
    So many thanks for replying me.please tell me,hows my portfolio.what should i add more so that i could get a good return.

  7. Hi Reema
    The most important thing for a new investor to understand is the concept of asset allocation. Never put all your eggs in one basket. One must have proper asset allocation in different asset classes like debt, equity, gold to diversify and spread risk. Typical asset allocation is 30% debt, 60% equity and 10% gold. You also must have diversification across funds and fund houses.
    Never mix insurance and investments. ULIPs are very costly instruments and must be avoided.

  8. Hi anil,
    Thanks for replying me.my age is 25 years.i have hdfc top 200,hdfc prucedencial fund.i invest 1000/m in both of these fund from last month.inspite of these ,i have
    1-icici gold saving fund-2000/m
    2-reliance super invest assure plan-10000/anualy from last three year.i have this plan for 15 years.
    i am new invester.i dnt have any idea anil ji,weither i am going right or wro

  10. Dear Sir,

    Thanks for time in reading my question. I would like to invest in gold. I am confused to go for which Gold ETF, since many are available in the market. Could you help me with your valuable answers please. Thank you

    Regards,
    Karthikeyan R

  11. Hi Hemant,
    I used to purchase 2 units of gold etf every month.But once the price of gold crossed 2500 per gram/unit,i have stopped purchased gold eft units as it exceeds my limit of 5000 per month.I am not sure as what I should do,should I still go ahead and buy 2 units per month irrespective of the price(and violate my budget of 5000 per month) or wait until the gold euphoria settles down or should I go ahead and open a 5000 rupees SIP in Reliance Gold Savings fund ?
    I still need to accumulate 100 to 200 units of gold etf over a period of 10 years down the line ? Let me know your suggestions ?

    Thanks,
    Pramod

    • Hi Pomie,
      Increasing amount will be bad idea – SIP means same amount every month. But if you are serious about accumulating gold on regular basis you can buy units on quarterly basis. 🙂

  12. I second Sanjay’s observation that the price of Gold will touch $2500-$3000 , but my guess is – it should happen even earlier – within the next 3- 5 years!

    The economies of most countries in Europe & America isnt good. It will be interesting to watch out for rates of the various currencies. Euro may not even exist- what with the PIGS (portugal, Ireland, Greece, Spain) in debt & England ,Germany not bailing them out . Countries like Switzerland (a safe haven to unaccounted money ) will have a gala time enjoying the fruits of money in their custody!

    Also to watch is the U S of A which has printed a large pile of its currency called Dollars.

    This will lead to even governments holding to precious metals like Gold .

    My suggestion is it is best to invest in Gold .

    • Hi Dasrap
      I agree that there is a place for gold in portfolio.But gold should be purchased in a sytstematic manner and the exposure to gold should not be more than 10% in the portfolio.

  13. In India one view about Gold will always stand, since the first invention of Gold,
    keep buying Gold when you have surplus money, and do not sell it until you are in need, this has happened for generation after generation and will keep happening
    no matter what the price of Gold is.
    To me I buy Gold not for my use or as investment but for the next generation to come.
    Regards

    • Hi Tony
      I have also read in a newspaper recently that a lot of Indians regularly buy gold for their daughters.The only change is that they used to buy bars or coins of 5 gms or 10 gms when the price of gold was low and now they buy 1gm or 2gms at a time.With steep hike in the price gold is now being sold in coins of 0.5 gm also. Recently people are buying gold leaves also.

  14. Hi Hemant
    Yes, I have enjoyed reading different views on gold. I liked this comment-
    “I do not like buying anything going straight up. I like to buy something going down. So if and when gold goes down, I hope I am smart enough to buy more.
    Another comment-
    An inert metal in every sense, gold has no intrinsic value as an asset so buyers focus primarily on its resale value.
    I have recently read in newspaper that goldsmiths are refusing to buy gold from customers at prevailing rates.Their excuse- Their job is to sell gold and not buy gold. So the resale value of gold is also an illusion.

    • Nice compiling work.

      Especially ” I do not like buying anything going straight up. I like to buy something going down” is the catch…. Very useful….

      It is a good time to pick good stocks / Mutual Funds (Large cap, Large and mid) systematically… repeat… systematically.

      Anil’s observation “goldsmiths are refusing to buy gold from customers” should be an eye opener for many of us.

      But do you agree that SIP in GOLDETF every month for next 10-20 years, for a known goal (not for investments) … is also to be considered ?

  16. In reality peoples are in confusion..18000 was looking a high price at that time ,20,000 was also high price, 22000 was also and now it has reached to more than 26000…Investors are waiting for correction since 18,000…and as sometimes stupidity also works ,investors who have bought gold at 20-22000 levels, are enjoying the benefits ..
    I have some foreign commodity brokers online on yahoo messengers and we chat sometimes.I do not know about their credibility but most of them are still looking optimistic for next 3-5 years..

  17. The price of gold will depend on how much currency is printed by US and other countries:) I guess gold will touch/surpass 2000$ and will come to 2000$ as average price for next 10 years.
    I will surely come back after 1 or 2 years to check my prediction.

    • Hi Sanjay,
      I liked your confidence & the way you have written “I guess gold will touch/surpass 2000$ and will come to 2000$ as average price for next 10 years.”.

    • I think rather generating relation between gold & paper currency,its suitable to generate it between inflation and gold.When US starts printing money,inflation in the system rises.Central banks and other big investment/hedge funds buy gold to protect their assets.There is sharp rise in Gold though demand is 17% lesser than Q2 2010.so we also can’t say that demand-supply statistics works or not.
      I think sharp price have really created problem who need to buy it for immediate purpose.E.g.marriage. and its a lesson for all that do not forget to accumulate gold systematically , independent of price over a period of time rather than waiting for a big correction.

      • I said… there is no ‘new’ message … the message ( max upto 10% allocation in gold) is well know and conveyed several times + price (of anything) would always depend on demand & supply.. so nothing new to take away from this article.

        • Ram, I don’t know how to put it nicely but I will try. If you don’t extract a message from an article, you don’t have to discourage the author with negative comments. You might be one heck of a knowledgeable person but these blogs are meant for people like me who learns something new everyday. Thanks for being understanding.

  19. hi Hemant…nice review once again…..I dont think most of the investors are smart enough to exit before the bubble burst…so its always better for common investors to keep a distance from those gold savings SIPs..but as a common investor like me, it is always a tough job to scatter my savings to different sectors like equty MF, debt fund, ppf, bank or post office deposit..at present I am working in State Government & my gross monthly salary is 40000=00..my expence is nearly 20000…pf amount is 2600 per month…at present i can save nearly 15000 per month..can you guide me what percentage of savings(15000/month) should I invest in equty mf, ppf , debt fund….my age is 27, I have already taken two term insurance from two company( lic jeevan anmol of 10 lacs & kotak preferred term plan of 25 lacs)…thanks in advance.

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