The ninth tranche of the 2021-22 Sovereign Gold Bonds (SGB) will open for subscription starting Monday, January 10 and offers a good investment opportunity for investors who wish to invest in gold. The SGB will be available for subscription until January 14. The Sovereign Gold Bond will be available at a price of Rs 4,786 per gram. Those who apply online will get a discount of Rs 50 per gram. For such investors, the issue price of the gold bonds will be Rs 4,736.
The nominal value of the bond is based on the simple average closing price (published by India Bullion and Jewelers Association Ltd (IBJA)) for 999 gold purity of the last three business days of the week prior to the subscription period, i.e. , On January 5. , January 6 and January 7, 2022.
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SGBs are issued by the Reserve Bank of India (RBI) on behalf of the central government.
But do you know how you can get the most out of this investment? Zee’s business expert, Jitendra Solanki, provides the best tips for maximizing profits.
Top SGB Investing Expert Jitendra Solanki’s Top Tips
Solanki said SGBs are a good investment option for all those who are willing to invest in gold. This has the benefit of exemption from capital gains tax if invested for 8 years. While investors have the option of exiting after five years, they will not have the benefit of tax exemption should they decide to exit in 5 years. An 8-year horizon should be taken when investing in SGB. It says a strict NO to premature REDEMPTION.
There is also additional interest, he said.
What to keep in mind?
The company said investors should know why they should invest when making an entry as an entry point is crucial. Over the past 8-10 years, prices have appreciated. Investors should buy only the amount that does not upset the balance of the portfolio. A 5 to 10 percent allocation in gold is considered good, he said.
SGBs are government securities denominated in grams of gold and substitute for holding physical gold. Investors must pay the issue price in cash and the bonds will be redeemed in cash upon maturity.
Payment of the Bonds will be made by cash payment (up to a maximum of Rs 20,000) or money order or check or electronic banking. The issue price of the gold bonds will be Rs 50 per gram less for those who subscribe online and pay via digital mode.
The Bonds will be denominated in multiples of gram (s) of gold with a basic unit of 1 gram. The term of the Bond will be for a term of 8 years with an exit option from the 5th year to be exercised on the interest payment dates.
SGBs are restricted for sale to resident individuals, HUFs, trusts, universities, and charities. The minimum investment allowed is 1 gram of gold while the maximum subscription limit is 4 kg for individuals, 4 kg for HUF and 20 kg for trusts and similar entities per fiscal (April-March) notified by the Government from time to time when.