GoldBug_Investor Subject: Gold future vs Gold ETF - which is better?

algotrader

I am confused between trading gold futures on MCX and investing in gold ETF. Futures give leverage but also risky. ETF is safer but no leverage. What do you guys prefer and why? My investment horizon is 6-12 months.

algotrader

Reply by: BullionExpert_Mumbai
For 6-12 months horizon ETF is better option. You dont have to worry about rollover cost, margin calls, daily volatility etc. Futures are for traders who can watch market daily and manage positions actively. Also in futures you pay STT and other charges which adds up. ETF is simple and effective for long term view.

algotrader

Reply by: ShortTermTrader_Chennai
But if you want to take leveraged position then futures is only option. With 10% margin you can take 10x exposure in gold futures. Just make sure you have stop loss and dont over leverage. I have seen people losing entire capital in 2-3 days because they dont follow risk managment.