What is Sovereign Gold Bond?
Sovereign Gold Bond is a government financial scheme in which the Government of India takes advantage of the increase in the monetary value of gold and pays interest to investors. You get returns based on the annual price of gold. These bonds are available for a fixed tenure and are issued by the Government of India. The basic objective of buying these bonds is to protect against inflation and take advantage of the rise in the price of gold.
Some features of Sovereign Gold Bonds:
1. Gold equivalent: The appreciation of these bonds is linked to the price of gold, giving investors a gold equivalent profit.
2. Interest: These bonds pay regular interest, the benefit of which investors receive.
3. Application Process: There are specific periods and methods for applying for these bonds, which are prescribed by the Government of India.
4. Mass Market: These bonds are available in various financial markets and investors can buy them from there.
5. Redemption: Sovereign gold bonds give investors the option to return their monetary value after a specified period.