Guide to gold investing in Singapore

Whether you're concerned about market volatility, looking to diversify your investment portfolio, or simply curious about gold's role in wealth preservation, you're not alone.

Gold has delivered exceptional performance in recent years, with prices reaching record highs in 2025 driven by factors including geopolitical tensions, central bank demand, and monetary policy shifts. However, it's important to remember that gold can experience extended periods of underperformance. As a non-yielding asset that generates no dividends or interest, gold should be viewed primarily as a diversification tool rather than a long-term growth driver.

The key challenge for most Singapore investors is not whether gold is "good" or "bad," but rather comprehending how it fits into a broader investment plan.

What role does gold play in an investment portfolio?

Understanding gold's characteristics helps you set appropriate expectations for how it contributes to your overall wealth strategy.

Portfolio diversification

Historically, gold has shown a low correlation with equities and bonds, meaning its price movements tend to not follow the direction of other asset classes. During market stress periods like financial crises, gold can sometimes hold value better than risk assets, helping reduce overall portfolio drawdowns.

Inflation and currency considerations

That said, gold is not a perfect hedge. Many investors assume gold is a guaranteed protection against inflation, but the reality is more nuanced. Gold can preserve purchasing power over very long periods and may perform well when investors lose confidence in currencies, but short- and medium-term performance can still be volatile.

Gold prices are influenced by many factors, including real interest rates, global USD strength, central bank demand, investor sentiment, and geopolitical conditions.

Income generation limitation

A major limitation of gold is that it produces no income. Unlike dividend-paying stocks, bonds, or REITs, gold does not generate cash flow. The return is generated only from selling at a higher price. This is why gold is often viewed as a diversifier rather than a compounding engine for wealth creation.

Singapore's tax advantages

Singapore makes gold investing relatively tax-efficient. Investment-grade gold with 99.5% purity or higher is GST-exempt and capital gains from selling gold are generally not taxed for individual investors, thereby enhancing after-tax returns.

Strategic allocation framework

• Many professional portfolio frameworks suggest allocating a single-digit allocation to gold, but that can differ based on the individual's financial goals
• A sustainable approach to build exposure is through disciplined investing, such as dollar-cost averaging, which reduces the risk of selling at lows during sharp, panic-driven downturns.
• It is generally not recommended that gold act as a replacement for an emergency fund. Even though it is relatively liquid, selling at the wrong time can lock in losses.

Gold ETFs: Things you should know

Gold ETFs (Exchange-Traded Funds) are one of the most convenient and accessible ways to invest in gold. A gold ETF typically tracks the price of gold and trades on an exchange like a stock. When you buy units of a gold ETF, you gain exposure to gold price movements without needing to store or insure physical bars.

Many gold ETFs in Singapore are backed by physical gold held in secured vaults, while others may use derivatives to replicate returns (synthetic exposure). For most investors, physical-backed ETFs are generally preferred because they reduce counterparty risk.

Gold ETFs in Singapore offer several advantages:

• Liquidity: General higher trading volume of gold ETFs mean that you can usually buy or sell quickly during market hours.
• Transparent pricing: Prices reflect global market value in real time.
• Lower “ownership friction”: No personal storage or insurance required.
• Portfolio integration: Easy to rebalance alongside other assets.

When comparing gold ETFs, investors should consider:

• Expense ratio: Often around 0.15%–0.40% per year.
• Tracking error: The ETF’s performance versus spot gold.
• Currency exposure: Gold is globally priced in USD, so an unhedged ETF introduces USD-SGD currency movements. Some products offer SGD-hedged exposure, which removes currency fluctuations but may incur hedging costs.

One downside of ETFs, however, is that the ease of trading can tempt investors to overtrade. Gold usually works best as a long-term strategic allocation, not a short-term speculation tool.

Gold ETF options in Singapore suit investors who prioritise liquidity and cost-efficiency, maintain brokerage accounts, and are comfortable holding gold through a financial product rather than physical possession.

Physical gold ownership in Singapore: An overview

While gold ETFs offer convenience and liquidity, some investors prefer the tangible nature of physical gold ownership. Physical gold provides direct ownership in tangible form, appealing to investors who value the psychological comfort of holding real assets they can see and touch.

Available formats include:

• Gold bars: From 1g to 1kg sizes
• Bullion coins: Such as Canadian Maple Leafs or South African Krugerrands
• Gold jewellery: Usually not ideal for investing due to large mark-ups

If your goal is investment exposure, bullion bars and widely recognised coins are usually the most practical. Jewellery tends to include high making charges and retail mark-ups that are difficult to recover when selling.

Purchase and authentication

When investing in physical gold in Singapore, it’s important to purchase from certified and reputable dealers. You must look for accreditation such as LBMA Good Delivery refiners, clear purity markings (for example, 999.9), serial numbers where applicable, and the manufacturer’s mark.

Physical gold comes with additional costs beyond the spot price:

• Premiums: Bars may cost about 2%–5% above spot; coins can be 5%–10% above spot due to minting and collectability.
• Storage costs: Bank safe deposit boxes cost $150–500 annually; professional vaults charge 0.6–1.2% of gold value per year.
• Insurance: Protection against theft or loss but adds to total costs.
• Selling spread: Buyback prices are usually below spot, reducing realised returns.

Storage options:

• Home storage: No recurring fees, but higher security risk and insurance complexity.
• Bank safe deposit box: Strong security, but insurance limits may apply.
• Professional vault storage: Highest security with comprehensive insurance, but ongoing fees may range around 0.6%–1.2% of value annually.

Physical gold typically suits investors who value tangible asset ownership, have significant amounts to invest, are comfortable managing logistics like storage and insurance, and don't require frequent liquidity.

Endowus Private Wealth offers a physical gold fund, exclusive to Accredited Investors (AI) only. To learn more about our list of funds exclusive to AI, please schedule a consultation with us.

How else can you invest in gold in Singapore?

Beyond ETFs and physical gold, several alternative vehicles provide different approaches to gaining gold exposure:

What are common mistakes to avoid when investing in gold?

Singapore gold investors should be aware of several pitfalls that can significantly erode returns or lead to poor investment outcomes.

• Emotional investing: Buying gold based on fear during market volatility or speculation about price spikes often leads to poor timing.
• Overpaying for collectible coins:  Numismatic coins carry premiums based on rarity and collector demand, factors unrelated to gold content. Investment-grade bullion provides better value.
• Inadequate due diligence on dealers:  Investors should verify business registration, read customer reviews, and compare prices across multiple sources. Prices significantly below market rates often signal risk.
• Treating gold as a growth investment: Gold functions as a portfolio stabiliser, not a wealth-building engine like equities over long periods.
• Ignoring total costs: Beyond purchase premiums, investors must account for storage fees, insurance, opportunity costs, and selling spreads. These costs can accumulate to 1-3% annually for physical gold.

Integrating gold into your diversified portfolio

Gold investment in Singapore benefits from accessible markets, favourable tax treatment, and robust regulatory oversight. However, success depends on treating gold as a portfolio component with a clear purpose: diversification and resilience.

A disciplined allocation can provide meaningful stability benefits without sacrificing long-term growth potential. Choosing the right vehicle depends on your preferences: Gold ETFs suit investors who value liquidity and efficiency, whilst physical gold appeals to those who want direct ownership.

The goal is balance. Gold should sit alongside equities, bonds, and other diversified assets, supporting your portfolio through different market regimes while your core investments drive long-term compounding.

Beyond gold alone, diversifying across a broader range of commodities and real assets can provide more comprehensive portfolio resilience. Real assets such as infrastructure, natural resources, and commodities collectively offer inflation protection and low correlation to traditional equities and bonds, whilst reducing concentration risk in any single commodity.

For diversified exposure to commodities including gold, explore commodity funds, including Franklin Gold and Precious Metals, Blackrock BGF World Mining, Ninety One Global Natural Resources and GMO Resources Fund on our Investment Fund List.