Posted on 9th Sep 2016
by TopShareBrokers Team
Sovereign Gold Bonds (SGBs) are government securities denominated in grams of gold. They are substitutes for holding physical gold. Investors have to pay the issue price in cash and the bonds will be redeemed in cash on maturity. The Bond is issued by Reserve Bank on behalf of Government of India.
Investors can buy these bonds through NSE/BSE at issue price when RBI announces a fresh sale or they can purchase it immediately through NSE/BSE at current price like any other security.
Investors can redeem these bonds for cash upon maturity of the bonds or can sell it on NSE/BSE at current prices.
|Bond Official Name||NSE Name||NSE Code||Subscription Date||Issue Date||Closing Price||Redemption||Interest||Status|
|Sovereign Gold Bonds 2017-18 – Series II||Sovereign Gold Bonds 2.50% July 2025||SGBJUL25||July 10, 2017 to July 14, 2017||28-July-17||Rs 2850||July-25||2.50% PA - Paid half-yearly||Close|
|Sovereign Gold Bonds 2017-18 – Series I||Sovereign Gold Bonds 2.50% MAY 2025||SGBMAY25||April 24, 2017 to April 28, 2017||12-May-17||Rs 2901||May-25||2.50% PA - Paid half-yearly||Close|
|Sovereign Gold Bond Scheme 2016 -17 – Series IV||Sovereign Gold Bonds 2.50% FEB 2025||SGBMAR25||February 27, 2017 to March 3, 2017||17-Mar-17||Rs 2893||Mar-25||2.50% PA - Paid half-yearly||Close|
|Sovereign Gold Bond Scheme 2016 -17 – Series III||Sovereign Gold Bonds 2.50% NOV 2024||SGBNOV24||October 24, 2016 to November 2, 2016||17-Nov-16||Rs 2957||Nov-24||2.50% PA - Paid half-yearly||Close|
|Sovereign Gold Bonds 2016-17 – Series II||Sovereign Gold Bonds 2.75% SEP 2024||SGBSEP24||Sep 01,2016 to Sep 09,2016||23-Sep-16||Rs 3150||Sep-24||2.75% PA - Paid half-yearly||Close|
|Sovereign Gold Bonds 2016-17 – Series I||Sovereign Gold Bonds 2.75% AUG 2024||SGBAUG24||Jul 18,2016 to July 22,2016||5-Aug-16||Rs 3119||Aug-24||2.75% PA - Paid half-yearly||Close|
|Sovereign Gold Bonds- 2016 Series-II||Sovereign Gold Bonds 2.75% MAR 2024||SGBMAR24||March 8,2016 to March 14,2016||29-Mar-16||Rs 2916||Mar-24||2.75% PA - Paid half-yearly||Close|
|Sovereign Gold Bonds, 2015-16||Sovereign Gold Bonds 2.75% FEB 2024||SGBFEB24||January 18, 2016 to January 22, 2016||8-Feb-16||Rs 2600||Feb-24||2.75% PA - Paid half-yearly||Close|
|Sovereign Gold Bonds, 2015-16||Sovereign Gold Bonds 2.75% NOV 2023||SGBNOV23||November 05, 2015 to November 20, 2015||26-Nov-2015||Rs 2684||Nov-23||2.75% PA - Paid half-yearly||Close|
Investors are going to get 2.50% per annum (Fixed rate) interest on initial investment. Interest will be credited semi-annually to the bank account of the investor and the last interest will be payable on maturity along with the principal. In such case if you are planning to buy physical gold for investment, this bond is giving same advantage + extra interest of 2.50% PA.As well as you can use this bound for collateral for loans.
|Points||Physical Gold||Gold ETF||Sovereign Gold Bond|
|Returns||Lower than actual return on gold||Lower than actual return on gold||Higher than actual return on gold|
|Safety||Risk of handling physical gold||High||High|
|Purity of Gold||Purity of Gold always remains a question||High as it is in Electronic Form||High as it is in Electronic Form|
|Capital Gain||Long term capital gain applicable after 3 years||Long term capital gain applicable after 3 years||Long term capital gain applicable after 3 years. ( No Capital gain tax if held till maturity )|
|Collateral against Loan||Yes||No||Yes|
|Tradability / Exit Route||Conditional||Tradable on Exchange||Tradable on Exchange. Redemption- 5th year onwards with GoI|
|Storage Cost||High||Very Low||Very Low|
Investors can buy/apply for the bond through SEBI authorized trading members and financial advisors of NSE, BSE and other channels specified by RBI like scheduled commercial banks and designated post offices. NBFCs, National Saving Certificate (NSC) agents and others can act as agents. They would be authorized to collect the application form and submit in banks and post offices. Application forms will be provided by trading members, authorized agents and can also be downloaded from RBI's website.
The Bonds are issued by the Reserve Bank of India on behalf of the Government of India. The bonds are distributed through banks and designated post offices, NSE and BSE. This should make subscribing to the bonds an easy affair. During redemption, "the price of gold may be taken from the reference rate, as decided, and the Rupee equivalent amount may be converted at the RBI Reference rate on issue and redemption".
Yes, there may be a risk of capital loss if the market price of gold declines. However, the investor does not lose in terms of the units of gold which he has paid for. Investor are going to get 2.75% interest PA on investment, which is apart from golf price movement.
Persons resident in India as defined under Foreign Exchange Management Act, 1999 are eligible to invest in SGB. Eligible investors include individuals, HUFs, trusts, universities, charitable institutions, etc.
Yes. Bond can be buy on the name of minor, the application on behalf of the minor has to be made by his / her guardian.
Min 1 gram and max 500 grams per person per fiscal year (April - March).
Yes, If the customer meets the eligibility criteria, produces a valid identification document and remits the application money on time, he/she will receive the allotment.
Yes. A customer can apply online through the website of the listed scheduled commercial banks,NSE,BSE.
The investor will be advised one month before maturity regarding the ensuing maturity of the bond. On the date of maturity, the maturity proceeds will be credited to the bank account as per the details on record. In case there are changes in any details, such as, account number, email ids, then the investor must intimate the bank/PO promptly.
Yes, these securities are eligible to be used as collateral for loans from banks, financial Institutions and Non-Banking Financial Companies (NBFC). The Loan to Value ratio will be same as applicable to ordinary gold loan mandated by the RBI from time to time.
Payment can be made through cash/cheques/demand draft/electronic fund transfer.
The bonds can be held in demat account.
The bonds are tradable on stock exchanges from the date to be notified by RBI. The bonds can also be sold and transferred as per provisions of Government Securities Act.
Yes, part holdings can be redeemed in multiples of one gm.
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