Sovereign Gold Bond
There is great news for those investing in Sovereign Gold Bond (SGB). Reserve Bank of India (RBI) has declared the price of premature redemption of SGB 2020-21 Series-VIII. Investors who bought this bond in November 2020 are now going to get excellent returns of about 212%. According to RBI, investors will be able to redeem this bond prematurely from May 18, 2026. The special thing is that the investment of Rs 1 lakh has now increased to approximately Rs 3.12 lakh.
How much was the redemption price fixed?
RBI said that the premature redemption price of SGB 2020-21 Series-VIII has been fixed at Rs 16,012 per unit. This price has been decided on the basis of the average closing price of gold of 999 purity on 13, 14 and 15 May 2026. This bond was issued to online investors in November 2020 at a price of Rs 5,127 per gram. Whereas for offline investors its price was Rs 5,177 per gram.
How did you get 212% return?
If an investor had purchased a unit through online mode for Rs 5,127 and now he is getting Rs 16,012, then his direct profit comes to Rs 10,885 per unit.
Returns calculated like this
Profit: 16,012 ÷ 5,127 = Rs 10,885 Percentage Return: 10,885 ÷ 5,127 × 100 = 212.30%
That means, if a person had invested Rs 1 lakh at that time, his amount would now have been around Rs 3.12 lakh. Annual interest received is not included in this.
What is SGB?
Sovereign Gold Bond is an investment option issued by the Central Government, which is issued by RBI. This is considered an alternative to buying physical gold. In this, the investor does not need to keep the gold at home and does not have to worry about its security. The price of these bonds is decided according to grams of gold. On maturity, the investor gets money according to the market price of gold at that time.
You also get the benefit of interest
SGB not only gives the benefit of increase in the price of gold, but investors also get a fixed interest of 2.5% per annum. This interest is deposited directly into the bank account every six months.
What is the investment limit?
Minimum investment in SGB can be made equal to 1 gram of gold. A person can invest up to a maximum of 4 kg gold. This is the limit for HUF also, whereas for trusts and other institutions the maximum limit has been fixed at 20 kg.
