Sovereign Gold Bonds: Since its launch, the government-backed gold scheme Sovereign Gold Bonds (SGB) has given investors staggering profits. SGBs combined a fixed annual interest rate of 2.5% with long-term, tax-free capital appreciation. In February 2024, the government ended the program due to growing exchequer costs. Many investors are now purchasing SGBs on the secondary market as the plan has ended.

How to Buy Sovereign Gold Bonds in India?
Similar to buying a regular share, investors can purchase SGB from the secondary market using any trading software like Zerodha, Groww, or Upstox. Because some series have extremely low liquidity, they must go to the search box and type “SGB” into the program, check the series name and maturity year, and look at the market price and trading volume.

Because the bid-ask spread causes prices to fluctuate significantly, it is safer to put a limit order. You will receive the 2.5% yearly interest straight into your bank account after the units are deposited to your demat account. Even if you purchased the bond on the secondary market, the capital gains are fully tax-free if you retain it until maturity.

Also Read: Can You Retire at 50? The Real Savings Math

Is it worth buying Sovereign Gold Bonds Now?
Only when SGBs are offered at a slight premium does purchasing them from the secondary market make sense. When compared to purchasing a gold ETF, the upside is significantly less if the premium is high.

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