Should you buy gold this Diwali or wait for prices to cool?

Instead of putting all your money into physical jewellery, consider gold ETFs, sovereign gold bonds, or digital gold.

With gold on a record breaking spree, buying the precious metal during Dhanteras and Diwali, which is considered auspicious by many, poses a dilemma this year. Should you honour the tradition or let the prices cool?

Gold is on a record-breaking streak in 2025, surpassing $4,000 an ounce for the first time, fueled by central bank purchases and a declining US dollar.

Why do people buy gold during Diwali

In the past, high prices haven't stopped people from buying gold on Diwali. It is tied to tradition and belief that buying the precious metal beings good fortune. Many buyers pick lightweight coins or smaller pieces of jewellery without straining their budgets. Some investors also use this period to add gold to their portfolio as a hedge against inflation.

Should you wait or buy now?

If your purchase is purely for investment, experts say you don’t need to rush. Prices may correct slightly after the festive rush when demand cools. But if you’re buying jewellery for weddings, gifts, or to mark the festival, waiting may not make sense — you’ll likely buy at the prevailing rate.

Also read | Here is a checklist when you go shopping for gold this Diwali

Smarter ways to buy this Diwali

Instead of putting all your money into jewellery, you can consider gold ETFs, sovereign gold bonds, or digital gold. These don’t come with making charges and offer superior liquidity and security. If prices dip, you can always add more gradually rather than making one big purchase.

The bottom line

If you’re buying to adhere to the custom, pick up something which isn't too expensive. If you’re looking at gold as an investment, stagger your purchase or wait for dips to get a better deal.