Bonds to Earn Quarterly Fixed Income

Features of Fixed Income Bonds

Fixed income bonds are debt instruments that government or non-government organisations, financial and otherwise, can issue and offer a fixed return on your investments. Bonds allow issuing entities to raise capital and provide investors with valuable investment opportunities.

Ideal for Low to Moderate-Risk Investors

The fixed income bonds India promises regular payouts of interest. Bonds with high credit ratings from CRISIL, CARE, ICRA, and other credit rating agencies can offer up to 9.43% yields with a low credit default risk. It gets better! Bonds with fixed interest rates are more predictable, balancing the risk factor further.

Comparatively Higher Interest Rates

Bonds are known to offer higher interest rates than FDs. For example, while corporate FDs can generate up to 9.20% interest per annum, corporate bonds can yield up to 10.77% annual interest rates.

Regular Interest Payout

While the face value is paid out at maturity, bond issuers pay regular (often monthly, quarterly, semi-annually, or annually) interest payouts to those who invest in fixed income bonds.

High Liquidity

Most fixed income bonds can be sold in secondary markets without drawing any penalty, making them highly liquid.

Capital Gains Tax

Tax is imposed on short-term capital gains from fixed-income bonds as per the respective tax brackets of investors. Long-term gains are taxed at 10% for listed bonds and 20% for unlisted bonds. The final number depends on indexation adjustments.

Benefits of Fixed Income Bonds

• Diverse Categories: Fixed income bonds can be categorised into different types of bonds, meeting the various investment requirements. For example, you can check out tax-free fixed income bonds to buy and enjoy tax exemptions

• Easy Investment: Constant tracking of market fluctuations is not necessary. Hence, bonds can be among the easiest to manage investments. Retired individuals and people with limited financial knowledge looking for easy capital growth can greatly benefit from these investment instruments.

• Stable Income Source: The periodic payouts can act as a regular source of income.

• Portfolio Diversification: Even seasoned or high-risk-tolerant investors can choose to invest in bonds for quick and easy portfolio diversification.

Credit Ratings of Fixed Income Bonds

CRISIL, ICRA, IND, CARE, and similar credit rating agencies generate ratings ranging from AAA to D based on various financial indicators like asset quality, capitalisation, liquidity, earnings, and market position

The following list can give you an understanding of what the different ratings can indicate.

• AAA: highest degree of safety, lowest credit risk

• AA-, AA, AA+: high degree of safety, very low credit risk

• A-, A, A+: adequate degree of safety, low credit risk

• BBB-, BBB, BBB+ : Moderate degree of safety, moderate credit risk

• BB: Moderate risk of default

• B-, B, B+: high risk of default

• C: very high risk of default

• D: In default or expected to be in default

Investing in Fixed Income Bonds

GoldenPi has a simple three-step investment procedure with a list of investment options and all the important details like interest rate, credit ratings, payout, maturity dates, and so on!

• Step 1: Sign up on GoldenPi.

• Step 2: Explore the many fixed return bonds.

• Step 3: Invest, monitor, and enjoy returns!