Business Standard

Big rush for Nifty-linked bonds

Rajesh Abraham  |  Mumbai 

The product is sold in India by DSP-Merrill Lynch, (a part of the Citigroup) and Rank Investments, the NBFC arm of Barclays Bank. The product is gaining ground as a new asset class among investors.  Though the structure and interest rates on the product vary from issuer to issuer, bankers said that 40 per cent-plus annual returns provided by the are instilling confidence among issuers and investors to structure the product benchmarked against the stock index.  Typically, the minimum ticket size for such bonds is Rs 10 lakh and the product is sold through mainly foreign and private banks to their clients in India. The investors in these bonds will have a lock-in period of 15-39 months.  The interest rates on such products also vary from 7-10 per cent, depending on the rating provided by credit rating agencies. The most popular, say bankers, is the zero-coupon Nifty-linked product.  If the Nifty gives negative returns, investors will get the principal amount back, according to the way the product is structured.  

RECOMMENDED FOR YOU

Big rush for Nifty-linked bonds

High networth investors lap up structured products sold by foreign banks The product is sold in India by DSP-Merrill Lynch, (a part of the Citigroup) and Rank Investments, the NBFC arm of Barclays Bank. The product is gaining ground as a new asset class among investors.  Though the structure and interest rates on the product vary from issuer to issuer, bankers said that 40 per cent-plus annual returns provided by the are instilling confidence among issuers and investors to structure the product benchmarked against the stock index.  Typically, the minimum ticket size for such bonds is Rs 10 lakh and the product is sold through mainly foreign and private banks to their clients in India. The investors in these bonds will have a lock-in period of 15-39 months.  The interest rates on such products also vary from 7-10 per cent, depending on the rating provided by credit rating agencies. The most popular, say bankers, is the zero-coupon Nifty-linked product.  If the Nifty gives negative returns, investors will get the principal amount back, according to the way the product is structured.   image

LIVE MARKET

BSE

  ( %)

NSE

  ( %)

Widgets Magazine

More News

STOCK WATCH

Company Price() Chg(%)
Ramkrishna Forg. 367.80 10.04
Idea Cellular 110.00 9.07
C P C L 157.20 8.41
Tata Motors 298.65 8.34
Bharti Infra. 384.55 8.29
> More on BSE Gainers
Company Price() Chg(%)
C P C L 157.15 8.64
Geojit BNP 32.10 8.63
Idea Cellular 109.65 8.40
Tata Motors 298.35 7.96
Bharti Infra. 384.10 7.89
> More on NSE Gainers
Company Price() Chg(%)
Bliss GVS Pharma 124.40 -19.97
B H E L 104.55 -13.13
Wockhardt 760.80 -13.09
Just Dial 417.45 -12.47
S C I 57.80 -9.97
> More on BSE Gainers
Company Price() Chg(%)
B H E L 104.45 -13.14
Wockhardt 762.10 -13.11
Just Dial 415.35 -12.54
SE Investments 165.55 -12.20
Cox & Kings 158.85 -10.25
> More on NSE Gainers
Widgets Magazine
Widgets Magazine
Widgets Magazine

Derivatives

Index
Instrument Type
Expiry Date
Option Type
Strike Price