- Sovereign gold bonds (SGBs) are issued by the Reserve Bank of India, and allow you to invest in gold indirectly. RBI’s latest SGB tranche opened for subscription on March 6 and closed on March 10.
- SGBs offer benefits like exemption from capital gains tax on redemption, interest on investment, and no GST on purchases.
- SGBs, according to the analysts at ICICI Direct, are the best way to take exposure to gold as an asset.
- Despite the recent volatility in gold prices, analysts have maintained their positive outlook on gold.
AdvertisementSovereign gold bonds (SGBs) are in the news now with the launch of the latest tranche of bonds from the Reserve Bank of India (RBI), subscription for which opened on March 6 and closes on March 10. While SGBs are not new, the attractiveness of gold as an investment has brought them into focus.
Analysts at ICICI Direct say that with the current rate hike cycle nearing its fag end especially in the US, their outlook on gold as an asset class remains positive, despite a 13% run up in gold prices in the last four months.
“Currently it is time to be equal weight in the overall asset allocation as while historical return is higher, the outlook stays positive given we are at the fag end of the interest rate hike cycle particularly in US,” said a report by ICICI Direct, adding that they recommend investors to allocate 10% of their capital to gold.
