SGB Scheme 2021-22 X Tranche Is Open For Subscription: Should You Subscribe?

Gold prices have been inching higher on heightened geopolitical tensions. In the retail market of Mumbai, 24K gold is quoting at over Rs. 51,000 per 10 gm. Likewise, sovereign gold bonds which as per RBI are government securities denominated in grams of gold have been promoted as financial savings in gold since 2015. These bonds are issued by the RBI on behalf of the government of India.

Gold's current pricing

In the international markets, gold amid the latest unrest due to Ukraine-Russia tension has gained in levels to $1970 and spot gold as of today has however receded to $1899.2 per ounce levels as the US dollar has gained. Back on the MCX too, gold April futures in today's trade topped levels of Rs. 51,211 at day's high.

Should you invest in Sovereign gold bonds 2021-22 Tanche X?

While experts suggest not to invest in physical gold given the uncertainty currently, there is a subscribe given to the latest tranche of SGB. IIFL Securities, Anuj Gupta is of the view that "Amid uncertainty caused by the ongoing Russia-Ukraine war, gold price is expected to remain highly volatile. At such time, SGB price of ₹5,109 per gm can be a good bet for long-term gold investors. If we look at the last 5 years return on gold, it has jumped from near ₹3,000 per gm to around ₹5,100 per gm levels, yielding around 70 per cent return to investors. After ascending to its life-time high in 2021, yellow metal prices have remained under the profit-booking heat on every rise in 2021. So, investing for 5 years long period through Sovereign Gold Bond Scheme can be a good bet in current geopolitical uncertainty."

In the views of Mr. Nish Bhatt, Founder & CEO, Millwood Kane International - an Investment consulting firm, " Investing in paper gold (SGBs) is a better and less hectic option as there is no storage cost, making charges in the case of gold jewelry.Gold prices have rallied to more than a year high due to the geopolitical tensions. Historically, gold has attracted investment in times of uncertainty due to its safe-haven nature. The situation in Ukraine has also led to a spike in crude prices. A rally in oil prices put pressure on the INR, thereby making gold more costly. Currently, gold is supported by international as well as local developments.

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