Is investment in gold still a lucrative option?

Gold sales in December 2017 were 15 percent higher than the previous month, as per a newspaper report.

Experts say this can hardly be considered data because it does not provide comparisons with figures from matching periods in previous years.

Gold is a major form of saving in rural and small towns of India. Increased prosperity, or even some spare cash, always leads to more gold being bought. Apart from a narrow set of people who have 'financialised' their savings, there remains a deep faith in gold that seems unshakeable at any scale less than that of decades, or even centuries, reports ET.

Most Indians consider gold to be a good passive investment and an excellent and reliable store of value. It goes without saying that gold is an investment—anything that can be bought and then sold is an investment.

Warren Buffett once pointed out in one of his articles, in gold's case, there's the additional problem of supply. At the (then) current prices, the world produces 168 billion US dollars of gold every year. Not just that, it is in the interest of the producers to dig up as much of the stuff as possible. It takes a lot of fresh inflows to sustain gold prices.

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