According to Alok Jain, SEBI-registered Investment Advisor and Founder of Weekend Investing, a simple thumb rule is to divide your age by two to arrive at the percentage of your portfolio that should be invested in gold. As reported by Mint and NetDania News, this formula was shared by Sanjay Kathuria on X, along with a clip from an episode of the Sanjay Kathuria Podcast featuring Alok Jain. Under this rule, a 30-year-old investor would hold 15% in gold, while someone aged 50 would allocate roughly 25% to the precious metal. This age-based approach ensures that gold allocation rises with age, increasing portfolio exposure to the metal over time as investors' risk tolerance and investment horizon naturally evolve.
The rule means a 30-year-old investor with a ₹20 lakh investment portfolio should invest ₹3 lakh in gold, while a 50-year-old with the same-sized portfolio would allocate ₹5 lakh to gold. According to Mint and NetDania News, this rule implies that gold allocation rises with age, increasing portfolio exposure to the metal over time. For example, if a 30-year-old has a ₹20 lakh portfolio, about ₹3 lakh should be invested in gold under this rule. The allocation increases proportionally with age, reflecting the changing risk tolerance and investment horizon of different age groups. This systematic approach ensures that gold maintains its strategic role as a portfolio diversifier regardless of market conditions.
As reported by Mint and NetDania News, Sanjay Kathuria explained why silver doesn't make the cut despite its recent rally. He stated that central banks accumulate gold while nobody accumulates silver. Gold plays a monetary role as a store of value, often held by central banks as part of their foreign exchange reserves, while silver derives significant demand from industries such as solar panels, electronics and electric vehicles, making its price more closely linked to industrial demand and economic cycles. This fundamental difference in demand structure explains why gold remains the preferred precious metal for long-term portfolio diversification.
According to Mint and NetDania News, Kathuria shared that investors should never exit gold but rebalance it every month. When gold grows from 20% to 30% of a portfolio, investors should trim it back to 20%. For example, if an investor has a ₹10 lakh portfolio with a 20% target allocation to gold, and gold prices surge making it worth ₹3 lakh while the rest of the portfolio remains unchanged, gold would now account for roughly around 30% of the portfolio. In such cases, investors can sell the excess gold and bring the allocation back to the original 20% target, maintaining the age-based allocation rule consistently over time. This disciplined approach ensures that gold remains a strategic asset rather than a speculative position.
