The Sovereign Gold Bond 2019-20 - Series V has opened for subscription today. This is a very good option for those looking to invest in gold. Here are 5 reasons to invest in the Sovereign Gold Bond 2019-20 - Series V.
1) Interest rates on the bonds
Normally, neither physical gold nor gold in any electronic format receives an interest rate. Here while you benefit from gold prices going higher, you also receive interest rate of 2.5 per cent per annum on your gold bonds. Interest on the bonds are paid twice a year.
2) Discount to current market price
The Sovereign Gold Bond 2019-20 - Series V is being offered at a price of Rs 3738 Per Gram (for applying online & payment in digital mode). This is at a discount to the current market price of gold. Look for online application and also payment through the online mode.
3) Decent investing limit
You can invest a very large sum to the maximum limit of subscription per fiscal year (April-March) of 4000 (grams) for Individual & HUF and 20000 (grams) for Trust and similar entities notified by the Government.
This is not bad at all for those looking to invest a really large sum.
4) Bonds are liquid
The bonds have a tenure of 8 years from the date of issue of the Bonds. Pre-mature redemption of the Bond is permitted after fifth year of the date of issue of the Bonds and such repayments shall be made on the next interest payment date.
However, the bonds would be listed on the stock exchanges, in the demateraliazed form, which means that they are easily liquid.
5) Very safe
The bonds are being issued by Reserve Bank India on behalf of the Government of India. Hence, they are very safe. Investors who have a long term perspective can apply for these bonds.