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Bonds

Perfect for capital preservation with fixed tenure and rate of interest

Safe and secure bonds aid in portfolio diversification

Best in class bonds meticulously shortlisted by our team of experts

Interested in investing in Bonds?

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How to invest in Bonds with Moneyfront?

We help you buy bonds from the secondary bond market. Depending on availability, you could purchase Government Bonds, Tax-free bonds, Corporate Bonds, Capital Gain bonds, Public Sector Bonds, High Yield Bonds and Perpetual Bonds.

Our team of experts does the necessary due diligence and offers the best-of-the-class bonds to our clients.

What are Bonds?

Bonds are financial instruments which are offered by the government or a corporate entity. These instruments carry an interest rate and mature at the end of a specified period. Bonds serve as a fundraising vehicle for its issuer. The interest rate offered on the bond is called the coupon rate. The amount that is borrowed, or the price at which a person can buy the bond, is called the face value of the bond.

Bonds can be issued as a private placement to a select group of bondholders or publicly offered. Bonds can be listed and unlisted. The market value of the bond may change on a day-to-day basis, as any other security which is traded publicly. Interest earned from few specific bonds are subject to taxes, other than Tax Free Bonds.

One of the reasons investors look at Bonds as an investment option is capital preservation. Taking a decision about investing in bonds is simpler than making a decision to invest in equity markets, as bonds have to repay the principal amount on a specific date or on maturity, unlike in equity.

All types of bonds, be it government bonds, corporate bonds or gold bonds, come with a commitment from the issuer to pay back the amount invested on a specified date.

Most passive investors, go for bonds for this reason, where they buy and hold until maturity. Active investors on the other hand, try to benefit from price changes, often by buying and selling bonds. Another key difference between investing in equity shares vs investing in bonds is that the selling price of your shares depends on the stock market rates, whereas the bonds if held till maturity will provide you the promised returns. Whatever the investment strategy, bonds are a great investment option if the investor is looking to diversify their portfolio.

Interest in parking funds with guaranteed returns?
Invest in bonds instantly

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Looking for a fixed period investment with higher rate of interest? Explore Corporate Fixed Deposits.

Benefits of Investing in Bonds

Higher fixed returns

Alongwith the safety of debt, Bonds provide higher fixed returns as compared to many other investment options. Multiple offerings are available and you can select the one where you are comfortable with the issuer (credit rating).

Immune to market volatility

Bonds guarantee a fixed return on investment on maturity. These are a safe investment option as they are immune from market volatility.

Steady source of income

They are also a steady source of income as the interest payout happens at a fixed frequency which could be annual, semi annual, quarterly or monthly. When held until the maturity date, the bondholder is repaid the principal amount (amount invested to buy the bonds) along with the interest.