Gold Bond Investors to Get 333% Returns on December 2017 Issue
In a move that is set to bring cheer to investors who had invested in the Sovereign Gold Bonds (SGBs) issued in December 2017, the Reserve Bank of India (RBI) has announced the final redemption price for these bonds. The RBI has fixed the final redemption price at ₹12,801 for the SGBs under the 2017-18 Series-XI, which had an issue date of December 11, 2017. This means that investors who had bought these bonds at ₹2,954 per unit will receive a staggering return of around 333%.
For those who are unaware, SGBs are a type of investment instrument that allows investors to invest in gold without actually holding physical gold. The bonds are denominated in grams of gold and are issued by the RBI on behalf of the Government of India. The returns on these bonds are linked to the price of gold, and the redemption price is calculated based on the average price of gold in the last week of the tranche.
The SGBs issued in December 2017 were part of the government’s efforts to reduce the demand for physical gold and to encourage investors to invest in non-physical forms of gold. The issue was a huge success, with many investors opting for this investment instrument as a way to diversify their portfolios and to hedge against market volatility.
The high returns on these bonds can be attributed to the significant increase in the price of gold over the past few years. Gold prices have been on an upward trend, driven by a combination of factors such as geopolitical tensions, economic uncertainty, and a decline in the value of the US dollar. As a result, the value of the SGBs has also increased, resulting in high returns for investors.
The RBI has also set the same price for premature redemption of the 2019-20 Series I SGBs, which had an issue date of June 11, 2019. This means that investors who had invested in these bonds will also be eligible for the same redemption price, provided they choose to redeem their bonds prematurely.
The high returns on SGBs are a testament to the attractiveness of these investment instruments. SGBs offer a number of benefits to investors, including a low-risk investment option, a hedge against market volatility, and the potential for high returns. Additionally, SGBs are also exempt from capital gains tax, making them an attractive option for investors who are looking to minimize their tax liabilities.
The announcement of the final redemption price for the SGBs issued in December 2017 is also a reminder of the importance of long-term investing. Investors who had invested in these bonds have had to wait for several years to receive their returns, but the high returns that they will receive will be well worth the wait.
In conclusion, the announcement of the final redemption price for the SGBs issued in December 2017 is a welcome move for investors who had invested in these bonds. The high returns of around 333% will be a welcome windfall for these investors, and will serve as a reminder of the potential for high returns from investing in SGBs. As the demand for gold continues to rise, it is likely that SGBs will remain a popular investment instrument for investors who are looking to diversify their portfolios and to hedge against market volatility.
Key Takeaways:
- The RBI has announced a final redemption price of ₹12,801 for SGBs under the 2017-18 Series-XI, which had an issue date of December 11, 2017.
- Investors who had invested in these bonds at ₹2,954 per unit will receive a return of around 333%.
- The SGBs issued in December 2017 were part of the government’s efforts to reduce the demand for physical gold and to encourage investors to invest in non-physical forms of gold.
- The high returns on these bonds can be attributed to the significant increase in the price of gold over the past few years.
- SGBs offer a number of benefits to investors, including a low-risk investment option, a hedge against market volatility, and the potential for high returns.
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