Sovereign Gold Bonds 2021-22: Subscription For 8th Tranche Ends Soon, Should You Buy?

Sovereign Gold Bond 2021-22: The eighth tranche of the government-run sovereign gold bond scheme will close for subscription on Friday, December 3. An issue price of Rs 4,791 per unit, equivalent to the value of one gram of gold, is applicable for the eighth installment of the gold bond scheme 2021-22, according to the Reserve Bank of India (RBI). The date of issuance for the tranche is set as December 7, 2021. (Also Read: What Are Sovereign Gold Bonds? Here's All You Need To Know )

The issue price for each tranche is fixed in rupees - calculated on the basis of a simple average of the closing price of gold of 999 purity, by the Mumbai-based India Bullion and Jewellers Association (IBJA) for the last three working days of the week preceding the subscription period. The gold bond scheme is also available through the RBI Retail Direct Portal - https://www.rbiretaildirect.org.in/. 

The state-run gold bond scheme - on behalf of the RBI, has become a popular means to invest the yellow metal in a non-physical form. Gold bonds are considered to be a safe bet for investment and are linked to the market price of the precious metal. After the current series, the gold bond scheme will be available for subscription for two more tranches in the current fiscal. (Also Read: Gold Bond Series VII-X- Key Things To Know )

Sovereign Gold Bonds 2021-22 Series VIII: November 29-December 3: Here's All You Need To Know

Should You Buy?

“The price for the sovereign gold bond tranche-8 has been fixed at 4791/gm. The sovereign gold bond is an effective way of taking exposure to gold. There is storage cost, as the holding format is digital, plus the investor stands to gain a 2.5 per cent/pa interest.

The government has raised over Rs 31,000 crore of funds via the scheme. SGB is a favored route for the government to convert all gold investments into a digital mode, it will help keep the deficit under control, provide support to the currency.

After hitting a nine-month high earlier in the month, gold prices were trading in a narrow range for the past few sessions,'' said Mr. Nish Bhatt, Founder & CEO, Millwood Kane International.

Discount For Online Subscribers

For all those who are investing in the gold bonds scheme online - in which the payment is done through any of the digital methods, a discount of Rs 50 per unit is applicable, according to the RBI. For the online subscribers, the issue price is set at Rs 4,741 per gram of gold in the seventh tranche of the sovereign gold bonds scheme.

How To Invest In Sovereign Gold Bonds

The sovereign gold bonds are sold through the scheduled commercial banks (except small finance banks and payment banks), stock holding corporation of India Limited (SHCIL), designated post offices, Clearing Corporation of India Limited (CCIL), as well as the recognised stock exchanges - National Stock Exchange of India and the Bombay Stock Exchange Limited. The gold bonds are held in the RBI books or in a demat form.