Trading in 7th tranche of SGB to start from Monday: BSE, NSE

New Delhi: BSE and NSE have announced that trading of seventh tranche of Sovereign Gold Bonds will begin on Monday, giving investors a bigger choice to diversify their portfolio without having to buy the metal in physical form. “BSE’s online bidding platform for Sovereign Gold Bond (SGB) Scheme 2016-17 Series 4 (Tranche 7) will be open for subscription from February 27 to March 3, 2017 for trading members to subscribe to the issue for their clients,” BSE said in a circular.

Separately, NSE said that bidding facility would begin from 9 am and continue till 5 pm. The bonds will be allotted to eligible applicants on March 17, 2017. NSE and BSE have been appointed by Sebi for acting as receiving office for collecting subscription bids from investors. SGB scheme was launched in November 2015 as an alternative mode of investment to physical gold.

So far, the government has come out with six tranches of the SGB. The minimum investment size in the secondary market will be 1 gm and the maximum will not exceed 500 grams per person per fiscal year. A self-declaration to this effect will be obtained. In case of joint holding, the investment limit of 500 grams will be applied to the first applicant only.

The tenure of the bond is eight years with an exit option from fifth year to be exercised on the interest payment dates. Government mobilised Rs 3,060 crore from five tranches. The Reserve Bank issues bonds on behalf of the government.

The bonds will be sold through banks, Stock Holding Corporation of India Limited (SHCIL), designated post offices and recognised stock exchanges — NSE and BSE. To encourage members and their client’s participation, BSE said it will pass entire 1 per cent commission received from the RBI for SGB scheme to trading members.