July 2023 Moneycontrol
There are expectations that the RBI may soon start giving dovish signals.
There are expectations that the RBI may soon start giving dovish signals.
He finds a lot more value in short-term papers maturing in one year than their longer-term counterparts.
Shift part of portfolio to longer-duration funds when inflation moves sustainably close to RBI’s target level
As the yield curve is flat, investors are better off investing in short-term bonds maturing in one to three years or mutual fund schemes that invest in such papers.
The recent tax changes by the government where the benefit of long-term capital gains tax on debt mutual funds was withdrawn has created a level playing field, drawing investor attention towards bonds.
“Making a private placement for corporates is more cost-effective and fast”.
“Investors can earn 40-200 basis points more than bank deposits of similar tenure by investing in a mix of T-bills and ultra short-term funds”.
SEBI has reduced the face value of bonds in private placement from Rs 10 lakh to Rs 1 lakh.
“Even though there is no increase in rates of PPF, it offers the highest post-tax return to investors”.
One should note that the NCD issue comes with a fair bit of credit risk as it is not rated AAA.