Is it right to invest via SIP in Axis Gold Fund?

I have started an SIP of Rs 5,000 in Axis Gold Fund. This is apart from Rs 20,000 SIP in three different equity mutual fund schemes. I am 45 years old. Is my decision to start SIP in Axis Gold Fund correct?
---Bharat Jain

Raghvendra Nath, MD, Ladderup Wealth Management, responds:

You are currently investing around 20% of your portfolio in gold. Unless you have a goal-based requirement, the current allocation is relatively high according to your portfolio. As an investor, you should allocate a maximum of 10% of your investments to gold. Gold as an asset class performs really well during any down cycle, thus having some allocation is good. However, if you look at historical returns from gold, it would be just near the inflation mark. There would not be any capital appreciation from holding gold.


We would recommend you to reduce your exposure to gold and you can park the same amount in any banking and PSU debt mutual funds as they would provide you with security and stable income appreciation.