9 comments

  • RRama Krishna

    Thanks. But YTM is different from Interest Rate. How to find out/determine whether YTM is more than Interest offered by Commercial Banks or NCDs?

    • Hello Rama Krishna, The title of the security already has interest rate except for Treasury bills / Dated Treasury Bills. These TB/DTB would not provide any interest as these are issued at discount price compared to bond price (e.g. Rs 1000 bond price is issued at Rs 950 and pays Rs 1,000 on maturity, Rs 50 is interest for the period).

  • Kamal Garg

    Nice, detailed and clear cut article on RBI Retail Direct Scheme.
    Many thanks for such a crisp and clear-cut note on the subject matter.
    However, I would like to initiate a debate with your esteemed readers on/through your forum as to “suitability” or “why” should one retail individual investor invest in such GoI bonds/securities which give a taxable return/yield of maximum 7% on a 30 years investment period. For institutional investors/banks, it is a different game as they have to invest by law in SLR or other obligated avenues.

  • Sivaraman

    Thank you so much for posting this article. Thanks for considering Suggestion topic

  • RRama Krishna

    Good information. Useful.

  • veera

    Dear Suresh Ji

    G-Sec Bonds Minimum How many Years will be locking period and interest is floating rate ?

    The Interest earned from the Bonds are again taxable ? Under the tax slab ?

    • Hello Veera, Lockin period = Tenure of the bond. However one can sell them on this to other buyers (like you sell shares on stock exchange). Yes are fixed income options, hence interest is taxable like any other FD interest where one need to add them to their income and pay income tax.

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