Though credited with stabilizing gold price, the recent gold-buying spree in China reveals a lack of investment options for Chinese households looking to retain asset value.

Despite a new price swing, the precious metal will stay buoyant at 1,542 US dollars per ounce for 2013, thanks in part to strong retail demand from China and India, predicted HSBC recently.

Chinese households came under the spotlight with their generous purchase of the yellow metal amid a growing chorus to short-sell gold to shore up the dollar and the US economy.

Chinese buyers have swarmed into retail stores in the mainland and Hong Kong over the past two weeks, snapping up 300 tons of gold, according Chinese media reports.

Yet spot gold transactions, though resurgent after gold took a dip, can have little impact on gold price, according to Zhao Xijun, deputy dean of the School of Finance, Renmin University of China.

"We all know gold can retain or even increase the value of assets. But we can only afford to buy gold accessories and gold bars," said a woman surnamed Cai, a resident of north China's Tianjin City.

The rush for bargains embodies the limited choice Chinese households have when it comes to investment.

With an under-performing stock market, tightly controlled property sector and low interest rates, Chinese households have scant options to invest their money for better returns.

While trust fund and insurance companies offer investment opportunities, they either have a threshold too high for ordinary households or can not allow investors to withdraw their money for emergency use, leaving people like Cai with very few choices to seek returns on their assets.

Money supply in China exceeded 100 trillion yuan (16.13 trillion US dollars) at the end of the first quarter this year. Inflation fluctuated along the benchmark interest rate in the same period, adding concern that assets in the form of bank deposits may not keep up with price hikes.

China has seen a boom in wealth management products (WMPs) and off-balance-sheet financing that promise better returns for investors. The value of bank-issued outstanding WMPs in China stood at 7.6 trillion yuan at the end of 2012, with an annualized return rate of 4.11 percent, about one percentage point higher than fixed one-year interest rates.

However, this high-yielding alternative to traditional bank deposits has raised suspicion as they are believed to be increasingly used to repay loans whose borrowers would otherwise default.

Such concern grabbed national attention late last year when a WMP sold by Huaxia Bank failed to pay its annualized return and a product offered by CITIC Trust delayed payments.

Those cases prompted moves by China's banking regulator to tighten oversight over WMPs to increase transparency and reduce risk.

Despite potential risks in these products, bank-offered WMPs remain a popular choice among investors.

However, these products are favored not for their ability to manage assets, but instead out of the belief that banks will bail out should losses occur, said Lei Wei, a financial expert with the Development Research Center of the State Council.

That's what makes Cai and many others think banks' offerings are a much safer choice.

However, experts think differently, saying a high yield always comes with high risks.

"The chase for a better return without accepting corresponding risks will bring distortions to the wealth management market," Lei said.

Regulators should step up oversight and create multi-layered wealth management business that match returns with risks, added Renmin University's Zhao. .