The Sovereign Gold Bond (SGB) 2020-21 Series-VII tranche is eligible for premature redemption on Monday (October 20), completing five years from its issue date. As per the Reserve Bank of India’s notification, the redemption price has been fixed at ₹12,792 per gram, calculated as the simple average of IBJA gold rates for October 15-17.

This tranche was originally issued at ₹5,051 per gram in October 2020. Based on the premature redemption price, investors stand to earn a simple absolute return of approximately 153% or 2.53x of capital.

This excludes the 2.5% annual interest that SGB holders receive semi-annually — which further boosts overall gains for those who stayed invested through the tenure.

Should investors redeem or continue holding?

SGBs have an 8-year final maturity, with ex

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