Gold Bond Investors to Get 333% Returns on December 2017 Issue
In a significant development for investors, the Reserve Bank of India (RBI) has announced the final redemption price for Sovereign Gold Bonds (SGBs) issued in December 2017. The bonds, which were issued under the 2017-18 Series-XI, will be redeemed at a price of ₹12,801 per unit. This means that investors who purchased the bonds at the issue price of ₹2,954 per unit will receive a staggering return of around 333%. The announcement has sent a wave of excitement among investors who had invested in the SGBs, and it highlights the potential of gold as a lucrative investment option.
The SGBs were introduced by the Government of India in 2015 as a way to reduce the demand for physical gold and to encourage investors to invest in a more secure and transparent way. The bonds are denominated in grams of gold and are issued by the RBI on behalf of the Government. They have a tenure of eight years, with an option to exit after the fifth year. The interest on the bonds is paid at a fixed rate of 2.50% per annum, and the capital gains tax is exempt if the bonds are held until maturity.
The December 2017 issue of SGBs was the eleventh series of the bonds, and it was open for subscription from December 11 to December 15, 2017. The issue price was ₹2,954 per unit, which was lower than the market price of gold at that time. The bonds were available for purchase in multiples of one gram, with a minimum investment of one gram and a maximum investment of four kilograms.
The RBI has also announced that the same redemption price of ₹12,801 per unit will apply to the premature redemption of SGBs issued under the 2019-20 Series I, which had an issue date of June 11, 2019. This means that investors who had invested in the June 2019 issue will also receive a significant return, although it will be lower than the return on the December 2017 issue.
The high return on the SGBs is a result of the increase in the price of gold over the past few years. Gold prices have been rising steadily since 2016, driven by a combination of factors such as geopolitical tensions, economic uncertainty, and a decline in the value of the US dollar. The price of gold has increased by over 50% since the December 2017 issue of SGBs, and this has resulted in a significant increase in the value of the bonds.
The announcement of the redemption price has been welcomed by investors, who are expected to receive a significant payout. The high return on the SGBs is a testament to the potential of gold as a lucrative investment option, and it is likely to attract more investors to the SGBs in the future. The SGBs offer a secure and transparent way to invest in gold, and they provide a fixed return in the form of interest and capital gains.
In conclusion, the announcement of the redemption price of ₹12,801 per unit for the December 2017 issue of SGBs is a significant development for investors. The high return of around 333% is a testament to the potential of gold as a lucrative investment option, and it highlights the benefits of investing in the SGBs. The SGBs offer a secure and transparent way to invest in gold, and they provide a fixed return in the form of interest and capital gains. As the price of gold continues to rise, it is likely that the SGBs will remain a popular investment option for investors looking to diversify their portfolios and earn a significant return.
The news of the high return on the SGBs is also likely to attract more investors to the gold market, which could lead to an increase in demand for the metal. This, in turn, could drive up the price of gold, making it an even more lucrative investment option. As the global economy continues to evolve, it is likely that gold will remain a popular investment option, and the SGBs will remain a secure and transparent way to invest in the metal.
In addition to the SGBs, there are other ways to invest in gold, such as through gold exchange-traded funds (ETFs) or gold mutual funds. These investments offer a convenient and flexible way to invest in gold, and they provide a range of benefits, including diversification and liquidity. However, the SGBs remain a popular option for investors looking to invest in gold, due to their security, transparency, and fixed return.
In the current economic climate, investors are looking for secure and lucrative investment options, and the SGBs fit the bill. The high return on the December 2017 issue is a testament to the potential of the SGBs, and it is likely to attract more investors to the gold market. As the price of gold continues to rise, it is likely that the SGBs will remain a popular investment option, and investors who have invested in the bonds will receive a significant payout.
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