Sovereign Gold Bond 2020-21 Scheme: Subscription for a fifth tranche of the government's Sovereign Gold Bond (SGB) 2020-21 programme will end on Friday. After the current issue, Series VI of the gold bond 2020-21 scheme will be available for five days starting August 31.These gold bonds, issued by the Reserve Bank of India, are linked to the market price of gold, and come with benefits such as an additional annual return of 2.5 per cent and a discount on online subscription.
The Sovereign Gold Bonds are aimed at restricting gold imports for the country, which is the world's second largest consumer of the yellow metal. Precious metal rates are currently near all-time highs due to uncertainty around the coronavirus pandemic, say analysts. (Track Current Gold Rates Here)
Typically, gold shares an inverse relationship with equities, and the safe-haven appeal of the precious metal rises with any sign of increased risk in equities.
(Also Read: Gold's "Dream Run" May Continue, Say Analysts)
Here are some key things about the government-run gold bond scheme:
Who Can Buy: Resident individuals, Hindu Undivided Families (HUFs), trusts, universities and charitable institutions can park their funds in gold bonds, subject to investment limits.
Where To Buy: Eligible entities can purchase the gold bonds from designated post offices, stock exchanges BSE and NSE, and the Stock Holding Corporation.
Online Discount: A discount of Rs 50 per gram is available for online subscribers, aimed at promoting digital payments.
Price: An issue price of Rs 5,334 per gram is applicable to Series V of the Sovereign Gold Bond programme.
Investment limit: A minimum of one gram and a maximum of four kilograms of gold can be acquired by eligible individuals and HUFs in a financial year. Trusts and similar entities can purchase up to 20 kilograms in a financial year.
The Sovereign Gold Bond and Gold Monetisation schemes were launched in 2015.
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