diff --git a/docs/blog/posts/localization.md b/docs/blog/posts/localization.md index 605b8fba..b8e19734 100644 --- a/docs/blog/posts/localization.md +++ b/docs/blog/posts/localization.md @@ -6,6 +6,7 @@ categories: - locale hide: - feedback +description: "How to setup Paisa for your country." --- # Localization diff --git a/docs/blog/posts/sovereign-gold-bond.md b/docs/blog/posts/sovereign-gold-bond.md new file mode 100644 index 00000000..470a7ba3 --- /dev/null +++ b/docs/blog/posts/sovereign-gold-bond.md @@ -0,0 +1,224 @@ +--- +date: 2024-01-26 +comments: true +categories: + - sovereign-gold-bond + - gold + - sgb + - price +hide: + - feedback +description: "How to track Sovereign Gold Bond price and calculate returns." +--- + +# Sovereign Gold Bond + +Reserve Bank of India started issuing a new type of bond called +[Sovereign Gold Bond](https://www.rbi.org.in/commonperson/English/Scripts/FAQs.aspx?Id=1658) (SGB) in November 2015. The bond is issued by +RBI on behalf of the Government of India. Each unit of the bond is +equivalent to a gram of gold. The price of the bond is linked to the +price of the gold. The price is calculated by taking the average of +the closing price of gold of 999 purity for the last 3 business days +of the week. RBI follows the price of gold published by [IBJA](https://ibja.co/). + + + +The bond also includes an interest component. The interest is paid +every 6 months. The initial bonds were issued with 2.75% +interest. Nowadays the interest is 2.5%. The interest is taxable as +per the income tax slab of the investor. Any capital gains on the bond +are exempted if you hold the bond till maturity. The bond has an 8 +year term with an exit option available from the 5th year +onward. In this blog post, we'll explore how to use Paisa to +effectively track your SGBs and calculate your returns. + +Let's assume you have `#!ledger 25,000 INR` in your bank account. + +```ledger +2015/11/01 Opening Balance + Assets:Checking:SBI 25000.00 INR + Equity:OpeningBalance +``` + +Let's assume you bought 8 units of SGB issued on 26th +November 2015. The price of a single unit was `#!ledger 2684 INR`. + +```ledger +2015/11/26 Buy Sovereign Gold Bond + Assets:Gold:SGB 8 SGB @ 2684.00 INR + Assets:Checking:SBI -21472.00 INR +``` + +If you go to the `#!ledger Assets:Gold:SGB` account, you'll see the +following + +![Initial Balance](../../images/sgb/balance-1.png) + +Let's add the interest component to the bond. The interest is paid on +26th of May and November every year. We need to make two +transactions entries for each interest payment. One from `#!ledger +Income:Interest:Gold:SGB` to `#!ledger Assets:Gold:SGB` and another +from `#!ledger Assets:Gold:SGB` to `#!ledger +Assets:Checking:SBI`. This is necessary to calculate the correct +returns. If you send the interest directly to your bank account, Paisa +will not be able to calculate the correct returns for `#!ledger +Income:Interest:Gold:SGB` account. + +```ledger +2016/05/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2016/05/26 SGB Interest Credit + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2016/11/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2016/11/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2017/05/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2017/05/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2017/11/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2017/11/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2018/05/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2018/05/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2018/11/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2018/11/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2019/05/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2019/05/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2019/11/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2019/11/26 SGB Interest Withdrawal + Assets:Gold:SGB 295.24 INR + Assets:Checking:SBI + +2020/05/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2020/05/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2020/11/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2020/11/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2021/05/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2021/05/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2021/11/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2021/11/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2022/05/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2022/05/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2022/11/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2022/11/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2023/05/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2023/05/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI + +2023/11/26 SGB Interest Credit + Assets:Gold:SGB 295.24 INR + Income:Interest:Gold:SGB + +2023/11/26 SGB Interest Withdrawal + Assets:Gold:SGB -295.24 INR + Assets:Checking:SBI +``` + +The final part is the bond settlement. The debit posting includes the +buy price, buy date and the sell price. The gains come from the +capital gains account. + +```ledger +2023/11/30 Withdraw Sovereign Gold Bond + Assets:Gold:SGB -8 SGB {2684.00 INR} [2015/11/26] @ 6132.00 INR + Income:CapitalGains:Gold:SGB -27584 INR + Assets:Checking:SBI 49056.00 INR +``` + +It's also possible to track the daily price[^1] of the bond. Since the +bond price is linked to the price of gold, we can use the IBJA gold +price to track the price of the bond. Go to the configuration page and +add a new commodity with the following information. + +![Commodity Settings](../../images/sgb/config.png) + +If you go to the `#!ledger Assets:Gold:SGB` account, You can find the +total returns, XIRR and the change of the bond value over time. + +![Final Balance](../../images/sgb/balance-2.png) + + +[^1]: The daily price history of IBJA gold price is available only + from 2022. If you have access to the price history, you can ping + me. Alternatively, you can manually add the [price history](../../reference/commodities.md#realestate) to the + ledger file. diff --git a/docs/images/sgb/balance-1.png b/docs/images/sgb/balance-1.png new file mode 100644 index 00000000..0dc0af1e Binary files /dev/null and b/docs/images/sgb/balance-1.png differ diff --git a/docs/images/sgb/balance-2.png b/docs/images/sgb/balance-2.png new file mode 100644 index 00000000..52ca5485 Binary files /dev/null and b/docs/images/sgb/balance-2.png differ diff --git a/docs/images/sgb/config.png b/docs/images/sgb/config.png new file mode 100644 index 00000000..46209ecc Binary files /dev/null and b/docs/images/sgb/config.png differ diff --git a/docs/stylesheets/extra.css b/docs/stylesheets/extra.css index 995f32fb..ff025e9f 100644 --- a/docs/stylesheets/extra.css +++ b/docs/stylesheets/extra.css @@ -323,3 +323,7 @@ background-color: var(--account-color-income-background); color: var(--account-color-income); } + +.language-ledger pre code { + max-height: 500px; +}