Types of bonds
Instead of scrollable carousel, we can make one image with the types all listed in the same space
Government Bonds
Safety Level: Highest
Issued by Central and State Governments with sovereign backing, offering the safest investment option.
Public Sector Undertaking (PSU) Bonds
Safety Level: High
Issued by government-owned companies, combining safety with better yields than G-Secs.
Corporate Bonds
Safety Level: Varies (Moderate to High Risk)
Issued by private sector companies, offering higher yields but with higher credit risk.
Tax-Free Bonds
Safety Level: High
Issued by government entities and PSUs with complete tax exemption on interest income.
Why invest in bonds?
Tired of low returns from traditional savings? Bonds and Debentures offer a powerful alternative, with the potential to generate annual returns of 9–10% or more. This reliable asset class is your path to accelerated wealth growth, featuring:
Predictable Income & Growth
Secure regular interest payments while also creating opportunities for capital appreciation.
Secure & Rated Options
Choose from highly-rated Government or Corporate (AAA to A) bonds that ensure your capital is protected.
High-Yield Opportunities
Risk-tolerant investors can explore lower-rated bonds (BBB and below) offering yields of 11-13%, with the understanding that higher returns come with elevated default risk.
Tax-Efficient Investing
Enhance your real returns with unique options like tax-free bonds and other tax-saving instruments.
Safety Ratings and Returns
Take a quick glance at the investment assets along with its safety levels and returns offered.
Fixed Income FAQs
Your Questions, Answered
The specific product in question determines the required minimum investment. The minimum investment for fixed deposits can start at ₹1,000, whereas bonds and mutual funds may require higher minimum amounts based on the fund house and investment type.
Government bonds and fixed deposits offer guaranteed returns amounting to the coupon rate mentioned, assuming they are held to maturity. Returns on corporate bonds and debt mutual funds can depend on market conditions and the creditworthiness of the issuer.
Selecting the appropriate instrument is dependent on your investment objectives, risk appetite, and time frame. Bars expert advisors can assist you in identifying the most appropriate fixed income options tailored to your requirements.
Fixed deposits are available through banks, ensuring reliable returns for investors. On the other hand, corporations or governments issue bonds, which have the potential to yield higher returns, but they also carry an increased risk due to credit and interest rate fluctuations.
Fixed deposits and bonds typically feature a predetermined maturity period. Withdrawing funds prematurely could result in penalties or a decrease in accrued interest. Debt mutual funds provide enhanced flexibility and liquidity options.
Absolutely. Fixed income investments serve as an excellent choice for retirees targeting consistent income while minimising risk exposure. They ensure a consistent cash flow, helping retirees effectively manage their living expenses.
The frequency of interest payments depends on the specific product. Fixed deposits typically offer options for interest payouts on a quarterly, annual, or maturity basis. Bonds generally offer annual or semi-annual interest payments, whereas debt mutual funds yield returns depending upon their performance.
Government-backed entities issue tax-free bonds, offering tax-exempt interest income. This makes them a compelling choice for investors aiming to minimize their tax outgo.
The relationship between interest rates and bond prices is inversely correlated. As interest rates increase, the value of current bonds generally declines. As a result, the impact of interest fluctuations on returns for fixed income products is significant.
Certainly. Debt mutual funds offer access to a diverse range of fixed income securities, facilitating diversification and expert management of your fixed income portfolio.
