What are Sovereign Gold Bonds (SGBs)?
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SGBs are government-backed securities that represent gold investment, offering interest and the potential to benefit from gold price appreciation.
BAJAJ BROKING
Backed by the Government of India.
Enjoy 2.5% fixed interest annually.
Invest in digital gold without the hassle of storage or safety concerns.
Trade SGBs on stock exchanges for ease of access to funds.
Exemption from capital gains tax at maturity.
Feature | Physical Gold | Gold ETFs | Sovereign Gold Bonds |
---|---|---|---|
Storage | Requires physical storage | Digital | Digital |
Interest Income | None | None | 2.5% per annum on investment value |
Capital Gains Tax Exemption | No | No | Yes |
Tradability | Limited | High | High |
Risk of Theft/Loss | High | None | None |
Purity Concerns | Possible | High Standardized Purity | Guaranteed by the Government |
Liquidity Costs | May involve making charges | Low | None |
Long-Term Holding | Storage costs can be high | Low management costs | No storage or management costs |
Investment Size Flexibility | High, depending on weight | Minimum 1 unit (1 gram) | Minimum 1 gram |
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SGBs are government-backed securities that represent gold investment, offering interest and the potential to benefit from gold price appreciation.
SGBs work by allowing investors to purchase bonds in gold, earn interest, and redeem them at market value after a fixed tenure.
The minimum investment is 1 gram of gold, while the maximum is 4 kilograms for individuals.
The tenure of an SGB is 8 years, with an option to exit after the 5th year.
Benefits include 2.5% interest per annum, capital gains tax exemption on redemption, and no storage concerns.
Yes, SGBs can be traded on NSE and BSE for liquidity before maturity.
Yes, SGBs offer exemptions from capital gains tax on redemption after 8 years.
You can purchase SGBs through Bajaj Broking’s online platform during the issuance period.
Indian residents, including individuals, HUFs, trusts, and charitable institutions, are eligible to invest in SGBs.
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