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E-Gold allows us to buy and hold gold in dematerialized form in a DEMAT account.
Dematirialized form means, we are not getting the gold physically in our hands, but its getting registered in our DEMAT account.
There are Several benefits of E-Gold compared to physical buying,
1. Easy to Liquidate(easy to sell them. As easy as selling shares)
2. Dont need to worry about the quality of the Gold(Everyone gets same quality(24C))
3. No lockers needed to store
In india E-Gold is available as ETFs(Exchange Traded Funds). NSE has a gold ETF which is free of risks but you can also search for other companies offering ETF services through internet but a thorough research should be done about that company before buying or selling gold.
Charges for buying and selling them depends on the brokerage charged by broking firms(usually some 0.3-0.5% per transaction) and ETF margins decided by the Equity markets BSE and NSE