Golden Pi is one of the best bond investment apps. We have done a complete Golden Pi Review to answer all your question on bond investing.
Where to invest to make regular income?
You may be well aware of investments to make wealth in long term thanks to the immense marketing of stocks, mutual funds, and cryptos.
However, it becomes difficult to find an investment option from where you can make a regular income.
Fixed deposits are safe but have no guarantee of inflation-beating returns.
Stocks and mutual funds can generate an inflation-beating return however the volatility in the short term does not guarantee a regular income.
You need something which is safe but generates more return than inflation.
This is where the concept of BOND investments comes into play.
In this article, we will understand what is bond investment and how to do bond investment in India.
What is Bond Investment
When a company wants to grow it needs money.
This investment they can get by
- Selling stocks
The company might not want to decrease their holding and selling companies’ stock might also send a negative message to the investors.
- Loan From Bank
Taking a loan from banks would cost heavy interest charges.
Another option is to borrow money from retail investors like you and me.
For this companies offer BONDS which is basically a guarantee that if you lend you will receive a fixed interest on the investment on the maturity of a certain period.
For example, a company XYZ issues a bond where the minimum investment is Rs. 1,00,000 with a 9% annual return which will be paid half-yearly with a maturity period of 5 years.
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Bond Types
Corporate Bonds
The bonds issued by corporate or private companies are known as Corporate Bonds.
Government Bonds
Similarly, governments need investments to carry out different development work.
Bonds issued by the Central/ State Government are known as Government Bonds.
Types Of Bond Risk
Default Risk
The company itself defaulted in which case your principal amount itself is at risk.
To avoid this kind of risk you can invest in government bonds or big brand private companies.
Credit rating can be useful in deciding the credibility of private companies. Try to invest in companies having at least AAA(triple-A) ratings.
Liquidity Risk
You have to wait till the maturity of the bond to get back the money.
However, you can sell the bond in the secondary market but then the price of the bond depends on the demand and supply.
If there is no buyer in the secondary market you will have to wait which is risky.
Pros and Cons Of Bonds
| Pros | Cons |
|---|---|
| Fixed Return | Lower returns than stock investing |
| Low-Risk | Default risk |
| Better returns than a savings account and fixed deposits | Minimum investment amount could be large |
| Bonds are rated based on risks making it easier to decide on one to invest | Cannot be liquidated easily before the maturity period |
Who should Invest in bonds?
Safe Investors
If you are someone who is retired and more than 60 years of age cannot take the high risk of investing in stocks or mutual funds.
However, investing in fixed deposits can lead to wealth erosion because of inflation.
In this scenario, it makes sense to take greater allocation into BONDS.
Moderate Investors
If you fall in the category of the 40s – 50s and nearing retirement should start taking some allocation in BONDS.
Even though you still stay highly invested in mutual funds and stocks, some part of the portfolio should be in low risks assets like BONDS.
How can I buy bonds in India?
Bond investing was known only to high-net-worth individuals, big fund houses, or corporates in the past.
However, platforms like GoldenPi have made it simple for retail investors to start investing in bonds.
Just follow the below 3 steps and you are done.
- Open an account on Golden Pi
- Complete KYC
- Choose a bond that matches your goal
- Make investment
Golden Pi only offers high credit-rated bonds of AAA(triple A) – A ratings on its platform to ensure a high level of safety.
About Golden Pi
- Founded: 2017
- Headquarter: Bangalore
- Founders: Abhijit Roy and Samir Baran Pratihar
- Transactions: 1000+ Cr.
- 4000+ Cr. worth of bonds available on the platform.
Golden Pi is one of the first platforms to offer the Bond investing option for individual retail investors.
Zerodha is a strategic partner and investor in Golden Pi.
You might be aware that Zerodha is one of India’s top discount brokers with the highest number of Demat accounts.
So you can be assured of the credibility of this platform.
Golden Pi Account Opening
Documents Required
- PAN (scanned copy)
- Address Proof (any 1 scanned copy)
- Aadhaar
- Driving License
- Passport
- Voter ID
- Photograph (scanned copy)
- Canceled Cheque (scanned copy)
- Demat account details
- DP ID
- Client ID
The below video will show you the entire process to open a Golden Pi account.
Golden Pi Collection Of Bonds
Ultra Short-Term Bonds: Bonds maturing within 12 months.
Highly Safe Bonds: Bonds rated ‘AAA’ by credit rating agencies such as CRISIL, ICRA, etc.
Tax-Free Bonds: Bonds where Income tax is not applicable on the interest amount received.
Bonds for Senior Citizens: Bonds issued by public sector companies or guaranteed by state govt, giving monthly or quarterly interest payments.
Public Sector Bank Bonds: Bonds issued by Public sector banks that are considered safe investments.
State Government Guaranteed Bonds: Bonds where State Government guarantees principal and interest payout.
Golden Pi Review
Golden Pi is one of the first and best bond investing platforms available in India.
The platform is easy to register and start investing in.
Golden Pi offers AAA(triple A) to A-rated bonds making investments relatively safe.
Great platform if you are looking for safe fixed-income investments.
You will receive timely updates and notifications for the bonds you invest in.
Backed by a great brand like Zerodha.
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Frequently Asked Questions
Is Golden Pi owned by Zerodha?
Zerodha is an investor and a strategic business partner of Golden Pi.
Is Golden Pi legit?
Golden Pi is legit. Golden Pi is just an intermediary platform facilitating investing in various bonds.
Golden Pi Account Charges
There are no account opening or transaction charges on Golden Pi.
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