Gold Bond Investors to Get 333% Returns on December 2017 Issue
In a move that is set to bring cheer to investors, the Reserve Bank of India (RBI) has announced the final redemption price of ₹12,801 for Sovereign Gold Bonds (SGBs) under the 2017-18 Series-XI, which was issued on December 11, 2017. This means that investors who had invested in these bonds at a price of ₹2,954 per unit will now receive a staggering return of around 333%. This is a significant windfall for investors who had put their money into these bonds, and it highlights the potential benefits of investing in gold bonds.
The Sovereign Gold Bond scheme was launched by the Government of India in 2015, with the aim of reducing the demand for physical gold and encouraging investors to put their money into a more secure and lucrative investment option. The scheme has been a huge success, with millions of investors putting their money into gold bonds. The bonds are denominated in grams of gold, and investors can buy them in multiples of one gram, with a minimum investment of one gram and a maximum investment of four kilograms.
The December 2017 issue of SGBs was one of the most popular issues, with thousands of investors putting their money into the bonds. The issue price was ₹2,954 per unit, and the bonds had a tenure of eight years. The bonds also offered an interest rate of 2.5% per annum, which was paid semi-annually. The bonds were also eligible for premature redemption, which meant that investors could redeem their bonds before the maturity date if they needed the money.
The final redemption price of ₹12,801 per unit is a significant increase from the issue price of ₹2,954 per unit. This means that investors who had invested in the bonds will now receive a return of around 333%, which is a staggering amount. To put this in perspective, if an investor had invested ₹1 lakh in the bonds, they would now receive around ₹4.33 lakhs, which is a return of ₹3.33 lakhs.
The RBI has also set the same price for premature redemption of 2019-20 Series I, which was issued on June 11, 2019. This means that investors who had invested in this series can also redeem their bonds at the same price of ₹12,801 per unit. The premature redemption option is available for investors who need the money before the maturity date, and it provides them with an option to exit their investment if they need to.
The high returns on gold bonds are a testament to the fact that gold is a safe-haven asset that can provide significant returns over the long term. Gold prices have been rising steadily over the years, and they are expected to continue rising in the future. This makes gold bonds an attractive investment option for investors who are looking to diversify their portfolio and reduce their risk.
The high returns on gold bonds are also a result of the fact that the Indian government has been actively promoting the Sovereign Gold Bond scheme. The government has been trying to reduce the demand for physical gold, which is a significant contributor to the country’s trade deficit. By encouraging investors to put their money into gold bonds, the government is trying to reduce the demand for physical gold and promote a more secure and lucrative investment option.
In conclusion, the announcement of the final redemption price of ₹12,801 per unit for Sovereign Gold Bonds under the 2017-18 Series-XI is a significant development for investors. The high returns of around 333% are a testament to the fact that gold bonds are a lucrative investment option, and they provide a significant return over the long term. The premature redemption option also provides investors with an option to exit their investment if they need to, and it makes gold bonds a more attractive investment option.
The Sovereign Gold Bond scheme has been a huge success, and it has attracted millions of investors. The scheme has also helped to reduce the demand for physical gold, which is a significant contributor to the country’s trade deficit. The high returns on gold bonds are a result of the fact that gold is a safe-haven asset that can provide significant returns over the long term, and they make gold bonds an attractive investment option for investors who are looking to diversify their portfolio and reduce their risk.
About the Author
