Can one buy gold contract by making a margin payment on a commodity exchange, particularly MCX?
Gold is not traded on a commodity exchange. One invests in gold futures. Future prices are different from gold prices. There are several limitations in taking delivery of gold. It is not always possible to get physical delivery of gold. You only get a physical delivery of gold at a few places. Secondly, it is credited to a separate account and not to your demat account. There is a major difference between gold futures and physical gold. Gold ETF is invested in physical gold, which is kept with the custodian bank and can’t be lent because the gold belongs only to the investor. How is tax calculated on gold ETF? — Chandan Diwedi There are more tax benefits on gold ETF as compared to physical gold. Capital gains tax calculations are similar to tax calculations on bond funds. When you invest in physical gold, long-term capital gains tax is levied after three years. In case of gold ETF, which is a mutual fund, long-term capital gains tax is levied one year after purchase. You also get the
