The Name’s Bond. Gold Bond.

Just like Ian Fleming’s iconic character, gold bonds have made a flamboyant entry into the scene.

On Nov 5th, the Prime Minister launched the much anticipated Gold Bond Scheme, which is aimed at limiting the allure of physical gold.

Here are a few things that you need to keep in mind succumbing to the yellow metal’s charms:

• The price of the bond would be benchmarked to the market price of gold
• The 10-year post-tax returns of gold are around 10-11%
• Gold bonds will pay an annual interest rate of 2.75% on the investment, apart from the capital appreciation
• Interest paid and capital gains would be taxable
• Gold bonds are more liquid and easier to safeguard than physical gold

Additional reading: Bonanza for Investors as Gold Heats Up