Business
Gold Investment During Diwali: Is It the Right Time?
As Diwali approaches on October 20, the allure of gold remains strong: For generations, Indians have marked Dhanteras by buying gold or silver as a sign of prosperity. But with prices soaring higher than ever this year, many are rethinking whether now is the right time to invest.
The Gold prices in India have hit the mark of ₹1,28,395 per 10 grams, while silver has reached ₹1,64,660 per kilogram, marking it a lifetime high. Globally, gold breached $4,300 per ounce, driven by a combination of factors, including central bank buying, geopolitical tensions, recession fears, and US-China trade concerns.
Experts expect gold to trade between ₹ 1.2-₹ 1.3 lakh per 10 grams this Diwali, with a potential climb to ₹ 1.5 lakh by early 2026. Meanwhile, Silver is witnessing a boom fueled by demand from electric vehicles and clean energy sectors, making it a hot pick for those who missed the gold rally.
Ajay Kedia, MD of Kedia Advisory, told Business Today, " We were not expecting such a bull run. But with global uncertainty and festive demand, gold and silver are delivering exceptional returns."
Should You Buy Gold This Diwali?
Experts advise that your reason for buying should guide your decision:
- If it's for tradition, weddings, or gifting, buying now is fine. The emotional and cultural value often outweighs short-term price concerns.
- If your goal is investment, experts recommend a staggered approach, which means buying in phases or waiting for a post-Diwali correction, as prices may dip slightly afterward.
Puneet Singhania of Master Trust Group suggests, "Invest through gold EFTs or mutual funds to manage volatility while staying exposed to long-term gains."
The Rise of Digital Gold
Though physical gold remains a festive favorite, digital gold and EFTs are gaining traction. Data from ICRA Analytics shows that inflows into Gold EFTs jumped 578% year-on-year in September 2025, indicating a major shift toward paper gold for flexibility and transparency.
Experts recommend a balanced approach: digital gold for liquidity and physical gold for legacy.
Tax Rules You Must Know Before Buying or Gifting Gold
Understanding gold taxation is crucial, especially when gifting or investing during the festive season.
- Gifts from Family: Gold received from relatives like parents, siblings, spouse, or in-laws is completely tax-free, no matter the value.
- Gifts from Friends/Non-Relatives: If the total gifts (including gold) exceed ₹ 50,000 in a financial year, the entire amount becomes taxable as "Income from Other Sources."
- Wedding Gifts: Any gold received during your marriage is fully exempt from tax, regardless of value or source.
When You Sell Gold
Selling your gold within three years is short term capital gain that will be taxed according to your income bracket.
Selling your gold after three years results in long-term capital gain that is taxed at 20% plus indexation benefits.
Always save invoices or gift receipts to confirm ownership and accurately calculate your gains later.
Bottom Line
During Diwali, gold remains a symbol of prosperity and auspiciousness, but by 2025, it will also be a high-risk investment. Whether you're buying coins for the Goddess Lakshmi's blessings or investing for the long term, understanding market patterns and tax laws guarantees that your holiday cheer doesn't come with a tax shock.
Members Discussion