Much to the excitement of my gold-bug friends, the RBI is selling gold bonds.
With Sovereign Gold Bonds (SGB) you can “own” gold without the physical costs and risks.
SGBs offer 2.5% annual interest paid semi-annually.
There is a limit on how much you can buy: 4kg per person per year.
But at current rates that is close to Rs 2 crore. So that shouldn’t really worry most folks.
How to buy SGBs
The best way is not to 😜 …..and I am only half-joking.
1. Gold is an unproductive asset. Its value is driven solely by scarcity. Kuch productive cheese mein paisa lagao.
2. The scheme has an 8y lock-in. Investments should be liquid. Aisa paisa kis kaam ko jo jail mein ho?
Surely you can buy gold (if you must) in other ways that are more liquid.
3. Early exit is possible from year 5 onwards. But only on the semi-annual coupon payment dates. And you must place a request for it in the 30 days before coupon date.
4. Demat bonds can be sold on the stock exchange. So you could get liquidity there … if there is liquidity.
But agar lena hi hai toh here are the dates to look out for:
And you should be able to buy them from online banking or your online stockbroker.
The above is not meant to be advice. Speak to your financial advisor before investing. Do join our Telegram channel for more.
