StepStone Asset Services by Pritika Jain
These are debt securities issued by governments, corporations, or other entities to raise capital. When you invest in a bond, you are essentially lending money to the issuer in exchange for regular interest payments and the return of your principal at the end of the bond’s term, known as maturity. Corporate bonds are typically listed on stock exchanges and can be bought and sold in the secondary market, providing liquidity to investors. Bonds are considered less risky than stocks.
Capital Gains Tax Exemption Bonds, are a type of fixed income investment instrument issued by are issued by select entities, such as NHAI and REC, to raise funds for specific infrastructure projects in the country.. These bonds are specifically designed to provide tax exemptions on capital gains arising from the sale of a long-term capital asset, such as property or land, as per the provisions of Section 54EC of the Income Tax Act, 1961.
Corporate FDs are investment instruments issued by companies to raise funds from the public. They are similar to bank fixed deposits, but instead of banks, they are issued by corporations. Corporate FDs typically offer a fixed interest rate for a specified period of time, ranging from a few months to several years. Corporate FDs are regulated by the Companies Act, 2013 and are typically rated by credit rating agencies based on the creditworthiness of the issuer. It’s important to carefully evaluate the creditworthiness and reputation of the issuing company, and consider the risks, returns, and liquidity of corporate FDs before investing in them. Contact us for more details.
FMPs are a type of debt mutual fund in India. They are close-ended funds with a fixed maturity period, typically ranging from 1 month to 5 years, as specified at the time of the fund’s launch. FMPs are managed by asset management companies (AMCs) and invest in fixed income securities, such as bonds, debentures, and other money market instruments, that mature around the same time as the maturity period of the fund.