Monday 9 October 2017

From on-tap availability to limit hike: 5 reasons to invest in gold bonds

Gold

The government on Friday announced several changes that would increase the attractiveness of sovereign gold bonds.

The most important change is that these bonds will now virtually be available on tap, as the issue that opened on Monday will remain open until December 27. However, the long-tenure issue will see the setting of price on a weekly basis. According to the Reserve Bank of India's (RBI's) announcement, every week, the bonds subscription will open on Monday and close on Wednesday. The price for that will be the previous last three trading days' average price for 999 purity.

The bonds sold between October 9-11 will be issued on October 16 and will get listed on stock exchanges two weeks after that. The issue that opened on Monday is priced at Rs 2,956 per gram and at Rs 2,906 per gram for online investment.

Next week, the bonds will open for subscription on October 16 and remain open until October 18. This system will continue till December 27, which is a Wednesday.

The second important change is the weekly price fixation, which would help investors to average their cost of buying.

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