For the final six months – except on July 2, 2020 – the cost of gold is hovering more than Rs 50,000 per 10 gm level. As a outcome, continuing its functionality of producing a double-digit return for the second year – the yellow metal has posted a return of almost 28 per cent in 2020.
It’s the second consecutive year for gold to post a stellar functionality as the yellow metal had also clocked a double-digit achieve in 2019.
To grab the chance to invest, apart kind in physical gold, investors now have the selection to invest in Sovereign Gold Bond (SGB) as the Ninth Tranche of the instrument opens on December 28, 2020. The challenge will close on January 1, 2021.
“The price for the Ninth Tranche of Sovereign Gold Bond, the last for the current calendar year has been fixed at Rs 5000/gm with a Rs 50/gm discount for an online subscription. The government has seen good demand for this instrument throughout the year. As per an estimate, the RBI has helped the government raised nearly Rs 23,000 crore in the past 5 years,” stated Nish Bhatt, Founder & CEO, Millwood Kane International.
While investment in physical gold has safety threat – like theft, burglary and so forth – resulting in more price of defending the valuable metal, investment in SGB is not only no cost of such dangers, but investors get 2.5 per cent per annum fixed interest on their investment and also get the Sovereign assure of the Government of India.
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Talking on the prospect of gold in the coming year, Bhatt stated, “As we approach 2021, gold will remain in focus for investors, as central banks across the globe have pledged to keep rates low, and easy liquidity to aid growth. The latest instalment of the stimulus package from the US government will add to the existing dollar liquidity in the system and may end up weakening the greenback.”
He also pointed out some things – like efficacy of Covid-19 vaccine, suitable implementation of the vaccination method in establishing nations, low-interest price regime, and the worldwide central bank’s stance on liquidity – that would guide the demand and cost of gold in 2021.