The 4th tranche of Sovereign Gold Bond (SGB) scheme opened for subscription on Monday, through which Government aims to attract a large number of investors so as to curb demand for physical gold that is imported in large quantities draining the country's foreign exchange.
The SGB issue price has been fixed at Rs 3,119 per gram. An investor can invest for a minimum unit of one gram and a maximum of 500 grams. The subscription is open till July 22. The first 3 tranches had attracted an investment of Rs 1,318 crore, equivalent to 4.9 tonne of gold at the prices prevailing at those times. With the added features, it is expected that the 4th tranche of SGB would garner much higher investment.
SGB can be purchased from stock exchanges NSE and BSE, all bank branches, select post offices and the Stock Holding Corporation of India limited. SGB Government securities denominated in grams of gold - offer an alternative to holding gold in physical form. The scheme was announced by the Government on October 30, 2015. “large number of investors and mutual fund players are set to benefit from National Stock Exchange electronic mutual fund platform which has started offering subscription to Sovereign Gold Bonds,” NSE said in a statement. SGB gives an interest of 2.75 per cent per annum, payable every six months on initial investment minus the risk of theft/loss or impurities associated with physical gold.