According to RBI, the final redemption to be held on May 9, 2025 will be Rs 9,486 per unit. This date has been chosen due to the holiday on May 10, 11 and 12. This price has been fixed based on the average price of gold between April 28, 2025 to May 20, 2025. May 1 was a holiday. The price of the final redemption is decided by the India Bullion and Jewelers Association Limited based on the average price of three working days of the last week of 999 purity by the 999 purity.
In May 2017, the issue price of SGB 2017-18 Series I was Rs 2,951 per gram. Investors online shopping were given a discount of Rs 50. The issue price for them was Rs 2,901 (Rs 2951-50 = 2901).
How much did investors benefit in SGB Series One?
The issue price of Sovereign Gold Bond (SGB) 2017-18 Series I released on May 12, 2017 was Rs 2,951 per gram. According to RBI, the final redemption costs Rs 9,486. SGB will be redeem on May 9, 2025. In this way, investors have received a return of 221% in eight years. It does not include interest. Investors have also received an interest of 2.5% annually on their gold bonds.
The amount of maturity on SGB is tax-free. Suppose you invested Rs 1,47,550 to buy 50 grams of gold according to the issue price of Rs 2,951. On maturity, you will get Rs 4,74,300 according to the final price of Rs 9,486. In this way you will get a tax-free benefit of Rs 3,26,750.
What are Sovereign Gold Bonds?
The RBI releases the Sovereign Gold Bond (SGB) by the Government of India. These bonds are in the gram of gold and provide an option rather than keeping physical gold. Interest is also received from time to time.
What are the dangers of investing in SGB?
If the price of gold falls in the market, there may be a risk of capital loss. However, the investor has no harm in the case of gold units.
Who can invest in SGB?
People living in India can invest in SGB. They are defined under the Foreign Exchange Management Act, 1999. These include individuals, HUFs, Trusts, University and Charitable Institutions. If a person’s residential condition changes and he becomes non-resident from the resident, he can keep SGB till redemption/maturity.
Is joint holding allowed?
Yes, joint holding is allowed.
Can a minor invest in SGB?
Yes. The application on behalf of the minor should be made from his guardian.
Some more things about SGB
– SGB can be placed in a demat account.
– SGB can be used as a collateral for loan.
– SGB can be traded in stock exchange.
RBI continues to issue SGB from time to time. You can get more information about SGB on RBI website.
Benefits of SGB
– Safe investment
– Interest gets
– Tax-free maturity
– Demat can be placed in account
– Can be used as collateral for loan
– Can be traded in stock exchange
Loss of SGB
– Capital loss threat
– Liquidity may decrease