Gold’s Meteoric Rally: Is Now the Right Time to Invest?

"Gold is not just a metal; it’s a store of value, a hedge against uncertainty, and a reflection of global confidence." — Market Insights

Gold in the Spotlight

2025 has been a remarkable year for gold. From geopolitical tensions to central banks diversifying away from the dollar, gold prices have surged to record levels. Currently, spot gold trades at $3,859 per ounce, up more than 55% from ₹78,000 per 10 grams last year to ₹1,21,500 in India. This rally has grabbed investors’ attention, prompting a question: Is now the right time to invest?

Unlike equities or fixed income, gold responds not only to economic fundamentals but also to global uncertainty, policy shifts, and central bank strategies. Its allure lies in its stability when other assets face turbulence.

Why Gold is Rallying

Several tailwinds are supporting gold’s rise:

• Central Bank Buying: Global central banks have purchased around 900 tonnes of gold in 2025, continuing a long-term trend of diversifying reserves away from the dollar. (World Gold Council)

• Weak Dollar: A weakening U.S. dollar makes gold more attractive as a reserve asset and investment.

• Geopolitical Tensions: Conflicts, trade wars, and global uncertainty drive investors to safe-haven assets like gold.

This combination of factors creates strong momentum, with gold serving as both a hedge and a strategic portfolio asset.

The Other Side: Headwinds

Gold’s rally, however, is not without challenges:

• Reduced Jewelry Demand: High gold prices make traditional demand from jewelers less viable, shifting interest to other metals like silver and platinum.

• Increased Supply: Higher prices incentivize mining in previously uneconomical regions, increasing supply and potentially moderating price gains.

• Global Policies: Changes in U.S. interest rates or a stronger dollar could reduce gold’s appeal.

Investors need to balance these headwinds against the strong tailwinds that have propelled gold to its current highs.

How to Approach Gold Investments

Timing the gold market can be notoriously difficult. Factors like global geopolitics, central bank policies, and taxation can create volatility that is hard to predict.

At Tikona Capital, we recommend a disciplined approach:

• Portfolio Allocation: Allocate a fixed percentage of your portfolio (5–15%) to gold based on your risk profile.

• SIP vs. Lump Sum: Systematic Investment Plans (SIPs) can help average costs over time, while lump-sum investments should align with long-term goals and risk tolerance.

• Diversified Instruments: Consider gold ETFs or sovereign gold bonds for efficient, cost-effective exposure without the challenges of physical storage.

• SIP physical Gold: Regular periodic physical gold if you are saving for your daughter's marriage.

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The Takeaway

Gold is more than just a commodity; it’s a strategic asset that provides stability, especially in times of uncertainty. While the rally has been impressive, investors should approach it with a clear plan, maintaining proper allocation and a long-term perspective.

Where Tikona Capital Fits In

At Tikona Capital Finserv, we understand that gold can be an essential part of your portfolio, but it comes with complexities. We help investors navigate these complexities and select the right investment options—whether it’s physical gold, ETFs, or sovereign gold bonds—ensuring your portfolio is balanced and resilient.

Gold may shine bright, but your wealth deserves steady hands. With Tikona Capital, you can combine opportunity with security and invest confidently for the long term.

Invest in gold strategically and safeguard your wealth.

Partner with Tikona Capital’s experts to create a balanced portfolio that includes gold, ETFs, or sovereign gold bonds tailored to your financial goals.

Download Tikona Capital App (Android): https://play.google.com/store/apps/details?id=com.tikona.capital.app

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Legal Information and Disclosures: The information provided in this article is for educational purposes only and should not be considered as investment advice. Investors should conduct thorough research and seek professional guidance before making investment decisions. SEBI Registered Research Analyst INH000009807. This newsletter expresses the views of the author as of the date indicated, and such views are subject to changes without notice. We have no duty or obligation to update the information contained herein. Further, we make no representation, and it should not be assumed, that past performance is an indication of future results. This newsletter is for educational purposes only and should not be used for any other purpose. The information contained herein does not constitute and should not be construed as an offering of advisory services or financial products. Certain information contained herein concerning economic/corporate trends and performance is based on or derived from independent third-party sources. We believe that the sources from which such information has been obtained are reliable; however, we cannot guarantee the accuracy of such information or the assumptions on which such information is based. For further information, disclosures, and disclaimers, visit www.tikonacapital.com

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