Sachin Kothari, Director of Augmont Gold For All, has discussed the return on Sovereign Gold Bonds (SGB). According to him, investors should always allocate at least 15% of their portfolio to gold for a superior risk-adjusted return. Sovereign Gold Bonds (SGB) are the best long-term gold investment choice in India.
The SGB is issued on behalf of the Government of India by the Reserve Bank of India, and the Sovereign Gold Bond Scheme has an eight-year tenure. A premature withdrawal is permitted after the fifth year from the date of the issuance of coupon payment dates. Aside from gold price appreciation, investors receive 2.5% interest on SGB semi-annually.
The first tranche of SGB, which matured on November 30, 2023, returned a stunning 150% to investors who kept it for the full eight-year term. As gold is an eternal bull market, similar types of returns could be predicted in investments via later tranches as well.