Here’s Why NCDs Are Better Than Fixed Deposits In Current Times?

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    NCDs or Non-Convertible Debenture are fast gaining popularity among investors who want to scale up their real returns. So, if you are a tax-payer falling under lower slab rate then you can consider NCDs for the following reasons. Currently, the secondary market offers you a number of NCDs to lapup including the longer term NCD of NTPC, Dewan Housing Finance and Mahindra Finance.

    Here’s Why NCDs Are Better Than Fixed Deposits In Current Times?

    1. Better Yield : Experts suggest depending on the maturity time as well as the quality of NCD, an yield anyway between 7.75% and 10% can be gained from investment in NCDs of corporates.

    2. High liquidity: As the NCDs are available for trading on the exchanges, they offer the liquidity as good as FDs.

    3. NO TDS deduction: Investor who maintains NCDs in th2eir demat account do not bear the cost of TDS as no tax is deducted at scource.

    4. Interest Payout: Depending on your needs for cash, you can opt for NCDs with monthly, half-yearly or annual interest pay-outs.

    5. Time to Maturity: Depending on your investment goals, you can buy a NCD for a short or long term. In contrast , other fixed income instruments such as bank FDs taken for a long time provide a rate of interest as low as 6.5%

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