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If better annual returns are in your mind Public Sector Undertaking Bonds (PSU Bonds) are a good option. Explore BondsIndia for information on PSU Bonds and other safe investments.
Public Sector Undertaking Bonds (PSU Bonds) are the bonds in which the government shareholding is generally more than 51%. It is a medium and long-term debt instruments issued by public sector companies. Indian Oil Corporation Limited is the biggest PSU in India.
Checking the credit rating and nature of bonds is always recommended. Make sure the credit rating, Investment nature, underlying security, and maturity aligns with your investment needs. PSU Bonds are considered a secure option for investment.
PSU Banks, power sector companies, railways, and other organisations issues PSU bonds as they have 51% of the government shareholding with them. These entities could be held by central or state government.
PSU bonds meaning - understanding the key terms and PSU bonds meaning can help you have a better understanding. Unlike other bonds, PSU bonds are also preferred by a certain percentage of the investors in India.
PSU Banks, power sector companies, railways, and other organisations issues PSU bonds as they have 51% of the government shareholding with them. These entities could be held by central or state government.
Public Sector Undertaking Bonds (PSU Bonds) unlike other bond types is a good source of investment for investors. It has its own importance. There are many advantages of investing in PSU bonds.
If you have a low risk-taking capacity, you should opt for banking and PSU bonds. Simply because the units belong to PSU companies and banks, which are supported and run by the government. It is a good investment instrument for investors paying higher income tax.
The public sector bonds have gained importance among the new investors. The widespread of the awareness may result in increased demand of public sector bonds in the near future.
Taxation is the main reason for you to opt for PSU bonds over Credit risk funds. Investors, who continue to hold profits of bonds beyond three years, usually have to pay long term capital gains tax of 20% with indexation benefit. However, if you continue to hold PSU bonds for less than three years, you will have to pay short-term capital gains tax according to your income slab.
PSU bonds remain invested in the mid segment of the yield curve in the 2-4 years. This segment accounts to have stable yields with much lower volatility levels with respect to the long-term debt funds. Keeping in view of the interest rate, Investors are recommended to have major chunks of their fixed Investment allocation in these products. The annual returns offered in PSU bonds are at the rate of 8% to 9%.
PSU bonds are a good investment instrument for investors in India. Keep investing in PSU bonds for a longer duration as it will yield you relatively better returns subject to price fluctuations in the market.
Taxation is the main reason for you to opt for PSU bonds over Credit risk funds. Investors, who continue to hold profits of bonds beyond three years, usually have to pay long term capital gains tax of 20% with indexation benefit. However, if you continue to hold PSU bonds for less than three years, you will have to pay short-term capital gains tax according to your income slab.
PSU bonds remain invested in the mid segment of the yield curve in the 2-4 years. This segment accounts to have stable yields with much lower volatility levels with respect to the long-term debt funds. Keeping in view of the interest rate, Investors are recommended to have major chunks of their fixed Investment allocation in these products. The annual returns offered in PSU bonds are at the rate of 8% to 9%.
PSU bonds are a good investment instrument for investors in India. Keep investing in PSU bonds for a longer duration as it will yield you relatively better returns subject to price fluctuations in the market.
PSU bonds are suitable for high income tax payers. It can prove to be a good investment instrument for many investors. Purchasing PSU Binds is simple and easy. You do not need to be an investment expert.
BY investing in top performing public sector bonds, you can diversify your portfolio and achieve certain financial goals.
Choosing the best from the many online platforms for investment in bonds and other securities can help you have a better investment experience.
BondsIndia is the dedicated online platform aimed at providing users the easy access to the range of bonds. You can explore the various investment products at BondsIndia for the informed decision on buying bonds.
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PSU bonds are issued in the denomination of Rs. 1000 each in India.
PSU bonds in India have maturities ranging between 5 and ten years.
The high-yielding PSU debt comes in the category of perpetual bonds held by PSU banks. These are certainly at high risk as they can be written down when the bank’s capital falls below specific thresholds. The bank does not have to be insolvent for the bonds to be written down. The bank can be bailed out, as what happened with Yes Bank.
Investors do not need to have any market knowledge on interest movements if they want to Invest in PSU bonds and don’t have to be anxious about tracking. You can Invest freely in PSU bonds whenever you want.
Relatively higher interest rates and low risk of default due to government guarantee.
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