Alternative Investments

Precious Metals & Gems:

What It Is:

Tangible assets like gold, silver, platinum, and gemstones valued for their rarity, durability, and ability to preserve wealth.

Key Features:

No minimum investment; high global liquidity
Hedge against inflation
Available in physical, ETF, or digital forms
Universally recognized value

Benefits:

Stability in uncertain markets
Portfolio diversification
High liquidity
Long-term wealth preservation

Limitations:

Moderate returns compared to equities
Storage and security costs
Purity and authenticity risks
No regular income

Types:

Physical (bars, coins, jewelry)
ETFs
Sovereign Gold Bonds
Digital Gold
Precious Stones (diamonds, rubies, emeralds)

Best For:

Risk-averse investors seeking safety and diversification; those looking to hedge against inflation and preserve long-term value.

Taxation:

In India, treated as capital assets
Short-term (<3 years): taxed at slab rate
Long-term (≥3 years): 20% with indexation

Fun Fact:

Nearly half of all gold ever mined is stored in jewelry — making it both a fashion statement and a global wealth reserve!

Real Estate:

What It Is:

Investment in land, buildings, or properties—residential, commercial, or industrial—aimed at generating income or long-term appreciation.

Key Features:

Tangible asset
Potential for rental income and price appreciation
Acts as an inflation hedge
Long-term wealth creation

Benefits:

Dual income potential (rent + appreciation)
Portfolio diversification
Physical ownership
Tax benefits on home loans

Limitations:

High entry cost
Low liquidity
Ongoing maintenance and legal costs
Market and regulatory risks

Types:

Residential
Commercial
Industrial
Agricultural Land
REITs
Fractional Ownership Platforms

Best For:

Long-term investors seeking steady returns, inflation hedge, and tangible assets for wealth preservation

Taxation:

Rental income taxed as per income slab
Capital gains taxed at 20% with indexation (if held >24 months)
Governed by RERA (Real Estate Regulatory Authority)
REITs regulated by SEBI

Economic Impact:

India’s real estate sector is the second-largest employment generator after agriculture and contributes significantly to GDP growth.

Precious Metals vs Real Estate Comparison

Feature	Precious Metals	Real Estate
What It Is	Tangible assets like gold, silver, and other precious metals	Physical assets such as residential or commercial property
Best For	Investors seeking liquidity, inflation hedge, and portfolio diversification	Investors aiming for steady rental income and long-term capital appreciation
Returns	Moderate returns mainly from price appreciation; no regular income	Dual returns — rental income plus property appreciation over time
Risk	Price volatility due to global demand and market conditions; minimal credit risk	Market, location, and legal risks; relatively stable but affected by economic cycles
Liquidity	High — easily tradable (especially digital gold and ETFs)	Low — buying or selling property can take months and involve high transaction costs
Tax Benefit	Taxed as capital assets; 20% with indexation if held for 3 years or more	Rental income taxed as per income slab; long-term capital gains (24+ months) taxed at 20% with indexation
Ideal For	Risk-averse investors looking for portable, inflation-hedged, globally recognized assets	Long-term investors seeking tangible assets, stable returns, and wealth creation through property ownership