10 Best Bond Brokers in India Investors always seek to earn more and are risk-averse while investing. Early investors typically take more risks at the start of their careers or in their early and late 20s, and as they age, they diversify their portfolio by shifting away from equities and towards fixed-income securities such as bonds and debentures, which carry little or no risk based on the securities purchased and are based on yield return. Some brokers provide a platform for investing in bonds. In this article, let us know about some of the best brokers in India.
Table of Contents
What is a bond?
Bonds are debt securities representing a loan from an investor to a government or corporation. Buying a bond means lending money to the issuer, receiving periodic interest payments, and getting the principal back at maturity. They ensure capital preservation, regular and constant income, and portfolio diversification.
Major Factors to Consider Before Investing in Bonds
Key concepts include issuer, face value, coupon rate, coupon payments, maturity date, yield, bond ratings, market price, types of bonds, callable/non-callable bonds, and zero-coupon bonds. They provide a fixed income but are subject to risks such as interest rates, credit, and inflation. Bonds are commonly used in portfolios to diversify and manage risk. Before buying bonds from any broker, make sure they are SEBI-registered.
Understanding types of bonds
Bonds are classified into several types, including Treasury bonds, municipal bonds, corporate bonds, high-yield bonds, mortgage-backed securities, floating rate bonds, zero-coupon bonds, callable bonds, convertible bonds, and inflation-protected bonds.
Eligibility
Earlier, High Net worth Individuals and financial institutions were permitted to purchase these in India, while retail investors were eligible for government bonds. However, retail investors have been able to invest in a wide range of bonds.
Awareness
The bond market in India is one of the least penetrated. In contrast to other developed markets, such as the United States, where retail investors can invest or trade bonds, India previously only allowed financial institutions and banks to do so. The inclusion of retail investors in recent times will certainly add more value, exposure to investors, and liquidity to the system.
10 Best Bond Brokers in India #1: GoldenPi
Abhijit Roy and Samir Baran Pratihar co-founded the company in 2017, which was registered in Bengaluru. Zerodha backed the startup. The SEBI Licensed Debt Broker provides a platform for investing in Fixed Income assets such as listed corporate bonds, non-current debenture IPOs, corporate fixed deposits, sovereign gold bonds, and government securities. They do not charge customers for any transactions. Some of their strategic partners include Axis securities, IIFL Securities, 5 paisa and Money by Tata Capital. Rs. 2,500 crore worth of transactions in bonds happen through their platform.
10 Best Bond Brokers in India #2: Wint Wealth
In 2020, Wint Wealth was established by Ajinkya Kulkarni, Abhik Patel, Vinay Dubey, Shashank Chimaladari, Anshul Gupta, and Sruthi Sivakumar. Zerodha and Cred backed the startup. They provide services for fixed-income investments, such as fixed deposits, government securities, corporate bonds, and sovereign gold bonds. The company claims to have over 53,000 investors and is worth over Rs. 1,300 crore. They recently launched securitised debt instruments that aim to invest in multiple listed bonds starting at Rs. 1 lakh.
10 Best Bond Brokers in India #3: The Fixed Income.com
Tirth Shah, who co-founded the company, started it in 2019. It is part of the Tipsons Group, which has been in operation for 30 years. They offer services for fixed-income investments, including fixed deposits, government securities, corporate bonds, bond IPOs, and sovereign gold bonds. They have facilitated investments worth over Rs 1,700 crore and served over 1,00,000+ users, since inception.
10 Best Bond Brokers in India #4: 5paisa
Initiated in 2015, the company was led by Nirmal Jain and had its headquarters located in Thane, Maharashtra. It is a subsidiary company of IIFL Holdings. The company offers a wide range of services, including stock broking and bond purchasing platforms. They have a client base of more than 2 million users.
10 Best Bond Brokers in India #5: IndiaBonds
Aditi Mittal and Vishal Goenka co-founded them, and they got started in 2021. They offer a variety of services, including bond trading, bond IPOs, government securities, and sovereign gold bonds. They have no brokerage or commission fees.
10 Best Bond Brokers in India #6: BondsIndia
Ankit Gupta and Puneet Aggarwal co-founded BondsIndia, which was established in 2020. They offer services such as bond purchases, fixed deposits, and bond IPOs.
10 Best Bond Brokers in India #7: HDFC Securities
HDFC Securities is a subsidiary company of HDFC Bank. They have a client base of more than 11 lakh. They offer services across multiple asset classes, including equity, gold, debt, and real estate. It includes stocks, derivatives, mutual funds, fixed deposits, NCDs, insurance, bonds, and currency derivatives.
10 Best Bond Brokers in India #8: ICICI Direct
ICICI Direct is a part of ICICI Securities, which is a subsidiary of ICICI Bank. They provide services More than 50 lakh consumers can take advantage of its online trading and investing services. Equity, commodity, and currency trading at the BSE, NSE, and MCX are among the services provided. The company also provides wealth products, home loans, loans against securities, fixed deposits, bonds, NCDs, mutual funds, and initial public offerings (IPOs).
Quick link to open an account with ICICI Direct
10 Best Bond Brokers in India #9: Bondskart
JM Financial supports and backs BondsKart through its Institutional Fixed Income Division (or “IFID”). Under Ajay Manglunia’s direction, IFID was established in 2019 within JM Financial’s Investment Banking, Wealth & Securities (or “IWS”) division. Since then, IFID has managed over 100 issuances and mobilised over INR 1,00,000 crore. They host nearly 80 premium-graded bonds through their platform, ranging from AA to AAA ratings.
10 Best Bond Brokers in India #10: NSE goBID
Retail investors can buy government securities (G-Secs) on this internet marketplace. Treasury Bills and Government of India Dated Bonds, which contain the Government of India’s pledge to pay interest and refund capital through the NSE goBID platform.
Conclusion
As we are at the end of the article, the investment in bonds or debentures will provide stable returns for the investors. However, understanding the risks associated with investments is critical for any investor, as the capital invested takes precedence over any returns. There were some instances where financial regulators and credit agencies failed to act, resulting in investors losing valuable money, and keeping an eye on the economy is essential. What do you think of these bond brokers? Let us know your views in the comments section below.
Written by Santhosh
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