Sovereign gold bonds are RBI mandated certificates issued against grams of gold, allowing individuals to invest in gold without the strain of safekeeping their physical asset. These bonds act as a secure investment tool for individuals, as gold prices are less susceptible to market inflations and deflations. Considering the popularity and demand for gold, prices of such assets tend to fluctuate significantly, a highly prospective investment avenue for all.
Issued by RBI under Government of India stocks, a particular window of booking is pre-set for subscription, during which this bond scheme is issued in the name of investors in tranches. Usually, the RBI announces issuance of the latest sovereign bonds in a press release every 2-3 months, with a week’s window during which individuals can subscribe to it.
A holding certificate for these bonds is issued in the name of the investor upon complete purchase process.
Convenient To Invest
Launched under the gold monetisation scheme by the central government in 2015; the primary aim of these treasury bonds was to reduce the hassle involved with other kinds of gold investments, as bullions and other physical forms of investments required proper secure storage.
Investors who purchase a gold bond are issued a holding certificate as a declaration of their investment, thereby acting as a proof. Individuals can also choose to digitise these certificates to utilise them in their DEMAT Accounts, thus enhancing the security of their investment more.
Little To No Risk
A (SGB) Sovereign Gold Bond is issued in accordance with the Government Security Act of 2006 by the RBI, on behalf of the central government. Such government backing makes these SGBs one of the safest forms of investments available to residents in India, as chances of defaults on repayment is absolutely zero. Any risk associated with these investments can be attributed to market fluctuations, causing volatility in prices of gold.
Capital Appreciation
SGBs returns are real as the price of this precious metal tends to majorly rise in a long term holding period. In times of stock market turmoil, investors tend to switch to gold, as it has the unwavering potential to hold its value even during under performance of different major functional companies available for investment.
With such advantages Sovereign Gold Bonds become the most favourable investment options for any individual investor trying his luck even with blue chip investment. This financial instrument is quite safe & the government is also quite encouraging and supportive for these investments as low risk factor drives money & circulates wealth and creates recurring margin for the involved entities along with making money for the investor.
For more information on investing in Sovereign Gold Bonds, connect with our experts over a call at 9977007175.