Make 15% RETURN on Debt Mutual Funds & GOI Bonds | Just 10% LTCG Tax | RBI Repo Rate 2024

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Leveraging the interest rate cycle presents a tactical opportunity for investors to maximize returns in debt instruments like bonds and debt mutual funds. In this video, I present a case for investing in long duration debt funds and long maturity government of India bonds. Ofcourse, predicting the interest rate cycle is important and I present some factors investors should consider to this effect i.e. when is the Reserve Bank of India (RBI) likely to reduce its repo rate which will increase bond prices and allow investors to make mark-to-market gains (capital appreciation) from the bonds held by them.

In my view, the repo rate reductions are just 5-6 months away and fixed-income investors can capitalize on this to make potential returns of up to 15-16% -- double of what they make on fixed-income instruments like fixed deposits, debt funds and bonds. Additionally, considering tax advantages, listed bonds present an attractive investment option.

👉 Video Chapters:
00:00 Interest Rate Cycle & High Returns on Fixed Income Instruments
01:26 RBI Repo Rate and How to Calculate Bond Prices
06:30 Where are the RBI Repo Rates headed in 2024?
07:12 1. Global Interest Rate Cut
08:09 2. India's Inflation Rate
09:25 3. Government of India's Fiscal Deficit
10:23 4. Inclusion of Indian Bonds in Emerging Market Bond Index
11:35 What Bond Managers say on changes in RBI Repo Rates?
13:59 What can Debt Fund Investors do?

#rbireporate #debtmutualfunds #bonds #debtfunds #interestrates

Disclaimer: I am not a SEBI registered investment advisor or research analyst. I am not registered with PFRDA or IRDA either. The content posted on this platform is purely for educational purposes and none of it constitutes investing or trading advice. Viewers should do their own research and diligence before investing or acting on the information presented. Some of the links I have posted in the video, the description, the comments and other related resources might be affiliate links

[niranjankulkarni]

I have been your viewer since many days, the best part of all your videos is statistical data and simplicity.. extensive research, best presentation and key topics are your USPs..

[askme]

Modi has made debt and gold fund investments less attractive by removing tax benefits on them . At least, debt / gold funds should have some tax efficiency like equity funds .

[milavbhavsar]

Right video at the right time. I just started shifting towards sbi megnum gilt and sbi long duration funds just to play interest rate. Been waiting for this opportunity since 2020...

[shivamgarg]

Have been watching content of Shankar since he used to make videos for ET Money...His content is always informative, concise and clear.

[vivekphatak]

If I understand correctly if the reporate goes up the bond will be available at higher premium

[harshitha.tr]

I was struggling to understand Bond Pricing during CFA....but this vedio has helped me to understand the topic better.

[balamuruganthangavel]

You have given quality financial content on youtube. This channel is underrated. Appreciate the hardwork!

[Yashuu]

I would pay for this type of content! Thank you, Shankar!

[mayankgupta]

​ @shankarnath So basically on a 7.5% G-Sec bond if someone additionally makes a gain of 3.5% due to bond price increase (when tax rate cut happens in future) then 10% tax rate on LTCG will only be on capital gain while Interest income will continue to be taxed at tax slab rate. Given this weighted tax for a 30% slab person would be around 24% in place of 30%.
Moreover to be able to get this capital gain I need to buy bond either at discounted price (which is not possible now), or to buy either from primary and secondary market and exit before maturity to get any capital gains. For this to happen someone should buy at-least 2030 maturing bond so that it has enough time to maturity?

[siddarthbansal]

Love your Videos Shankar, they can be easily prescribed as part of any MBA finance course.Keep up the good work

[mohit]

This is brilliant... Reminded me of economics classes in CA foundation...
Immensely meaningful and informative

[rakeshsingh-edws]

Sir, could you enlighten us about market link debentures ( MLD ) . It is possible to make any investment strategy

[deepakrao]

Highly Underrated channel. Many, Many Thanks & deep gratitude

[uncommonprofit]

Thanks Shankar excellent video . Just 1 question is there a co-relation of the returns of the long term bond fund with domestic equity markets ?

[priyalgautam]

Sir why is my Power finance Bond is showing loss of 36000?

[harshkarnawat]

Hey Shankar! Great content as always, I had just started building some positions using gilt mfs.
I am not exactly clear on the 10% taxation part and what is a 'listed bond'. I was able to locate the article you show as a screenshot but do you have any resources where I can read up and understand more about the debt investments that are taxed at a favourable 10% ?

[vaibhav]

Nippon India nivesh lakshya fund has a maturity of 20-22 yrs

[lokesharora]

Sir
Very nice video.i saw three times . I have 2 questions
1 i have invested in 7.25 CS BOND 2063( 40 YRS GOVERNMENT SEC) for retirement instead of lic pension plan .what will effect on decreasing int rate by 1 percent . Should i lock cap appreciation in 2 yrs n reinvest .
2 i have got 30 lakh by maturing fd in bajaj fin. What should I do
(A) So for same (40 yrs bond)
(B) 10 to 15 yrs govt bond
(3) Long term debt fund like ( icici long term debt fund)
4 dynamic bond fund
One more thing i did not know the liquidity of these fund
Thanks

[gauravmishra]

Which is better Gilt fund or long duration fund (i.e., Nippon Nivesh Lakshya Fund)?

[piyushpathakvlog]

Sir, invested in Nippon India Lakshya fund, What will be the right time to switch to short term fund? At time when rate cut cycle ends or to be continued for 5 years? Which redeem option is profitable? Thanks for your video.